Summary of Forum Energy Technologies (FET) Conference Call Company Overview - **Company**: Forum Energy Technologies (NYSE:FET) - **Industry**: Energy sector, specifically oil and gas equipment manufacturing - **Segments**: - Artificial lift and downhole (42% of revenue) - Drilling and completion Core Points and Arguments 1. **Product Offerings**: - Provides products to energy companies like ExxonMobil and Saudi Aramco, enhancing hydrocarbon production efficiency by extending pump life and removing impurities [2][3] - Supplies drilling equipment to major oilfield service companies such as Halliburton and Schlumberger [2] 2. **Financial Performance**: - Achieved a compound annual growth rate (CAGR) of 15% in revenue from 2021 to 2024 [5] - EBITDA increased from $20 million in 2021 to $100 million in 2024, with margins rising from 4% to 12% [5] - Free cash flow growth of 73% annually since 2021, compared to a negative 2% for the Russell 2000 [6] 3. **Valuation Metrics**: - FET's free cash flow yield is four times higher than the average Russell 2000 stock [8] - Valuation metrics indicate FET is 2-3 times less expensive than the average Russell 2000 stock [8] 4. **Capital Returns**: - 50% of free cash flow allocated to net debt reduction, decreasing net debt from $344 million to $114 million (67% reduction) since 2019 [9] - 7% of shares repurchased in 2025, totaling approximately 1.1 million shares [9] 5. **Growth Strategy**: - Focused on targeted markets with limited competition, leveraging manufacturing know-how and intellectual property [10][11] - Anticipates revenue growth of 30% to $1 billion in a flat market scenario, with potential to double revenue to $1.6 billion in a growing market [19][21] 6. **Market Position**: - Holds a 36% market share in leadership markets, with an addressable market size of $1.5 billion [14] - Growth markets represent a $3 billion opportunity with an 8% market share, indicating significant potential for new customer acquisition [16] 7. **Innovation and Technology**: - Continuous innovation in product development to maintain competitive advantages and expand addressable markets [11] 8. **Subsea and Deep-water Projects**: - Approximately 10% of revenue tied to subsea products, with a strong backlog indicating future demand [23][26] Other Important Insights - **Book-to-Bill Ratio**: Currently at 122%, indicating higher than normal demand for capital equipment, particularly in international markets [27] - **Cost Savings Initiatives**: Management has implemented cost-saving measures totaling $15 million, contributing to a favorable outlook for the next year [26] - **Market Drivers**: Anticipated growth in global GDP and urbanization will drive oil and gas demand, necessitating efficient production solutions [20] This summary encapsulates the key insights from the Forum Energy Technologies conference call, highlighting the company's strong financial performance, strategic growth initiatives, and market positioning within the energy sector.

INVESTOR SUMMIT VIRTUAL CONFERENCE DECEMBER 9, 2025 Forward Looking Statements and Non-GAAP Reconciliation The statements made during this presentation, including the answers to your questions, may include information that the Company believes to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements involve risk and uncertainties that may cause actual results or events to differ materially from those expressed or implied in such statemen ...

Group 1 - Forum Energy Technologies, Inc. (FET) will present at the Investor Summit Virtual Conference on December 9, 2025, at 9:00 a.m. Central Time [1] - The event is open access, and interested parties can register through a provided link [1] - A live webcast and presentation slides will be available on FET's website prior to the event [1] Group 2 - The Investor Summit is a virtual event that connects investors with small and microcap companies, allowing attendees to hear directly from company executives [2] - Attendees will have access to 1-on-1 meetings with company executives to discuss key strategies and milestones [2] Group 3 - FET is a global manufacturing company serving the oil, natural gas, industrial, and renewable energy industries [3] - The company is headquartered in Houston, Texas, and provides value-added solutions to improve safety, efficiency, and environmental impact for its customers [3]

Core Insights - Forum Energy Technologies (FET) has experienced a significant stock price increase of 106% this year, outperforming the broader stock market [1] Company Performance - FET is recognized as one of the top-performing stocks in the entire stock market for the current year [1]

Core Insights - Forum Energy Technologies (FET) has emerged as one of the top-performing stocks in the market this year, with a remarkable surge of 106% [1] Company Performance - FET's stock performance significantly outpaces the broader market, indicating strong investor interest and confidence in the company's prospects [1]

Summary of Forum Energy Technologies (NYSE:FET) FY Conference Company Overview - **Company Name**: Forum Energy Technologies (FET) - **Ticker**: NYSE:FET - **Industry**: Oil and Gas Equipment and Services - **Segments**: - Artificial Lift and Downhole - Drilling and Completions - **Global Reach**: Approximately 50% of sales are international, with a focus on high-value consumables and capital equipment [4][6][7] Financial Performance - **Revenue Growth**: Revenue increased by approximately 15% from 2021 to 2024 [8] - **EBITDA Growth**: EBITDA grew from $20 million to $100 million from 2021 to 2024, with margins increasing from 4% to 12% [8] - **Stock Performance**: - 5-year annualized stock price return of 19% compared to Russell 2000's 10% [9] - 1-year return of 73% versus Russell 2000's 9% [9] - **Cash Flow Growth**: Compound annual growth rate of cash flow at 73% compared to Russell's negative growth [10] Investment Value - **Valuation Metrics**: - Adjusted cash flow yield is nearly four times higher than Russell 2000 [10] - Enterprise value to EBITDA and price to sales ratios are significantly lower than Russell 2000 [10][11] - **Debt Reduction**: Net debt reduced from $344 million in 2019 to $114 million, with a net leverage ratio decrease from 3.9 to 1.3 times [11][12] - **Share Repurchase**: 7% of shares retired since the start of the year [12] Growth Strategy - **Market Strategy**: Focus on targeted markets with limited competition and differentiated product offerings [13][14] - **Leadership Markets**: Represent about two-thirds of revenue with a 36% market share in a $1.5 billion addressable market [17] - **Growth Markets**: Addressable market of approximately $3 billion with lower current market share [20][22] - **Product Innovations**: New applications in defense and coiled line pipe, enhancing existing assets [20][21] Market Outlook - **Industry Growth**: Anticipated market growth of 9% annually, with potential revenue doubling to $1.6 billion by 2030 [25][26] - **Operating Leverage**: 25-35% of incremental revenue expected to convert to EBITDA, with a potential tripling of free cash flow by 2030 [26] - **Service Intensity**: Increased efficiency in drilling operations expected to drive demand for FET's products [24][25] Key Takeaways - **Competitive Position**: FET aims to maintain a leadership position in niche markets with few competitors [30] - **Geographic Expansion**: Opportunities for growth in international markets, particularly in the Middle East [31] - **Oil Price Sensitivity**: Company performance is linked to oil price thresholds that influence spending decisions [32] This summary encapsulates the key points discussed during the Forum Energy Technologies FY Conference, highlighting the company's financial performance, investment value, growth strategy, and market outlook.

Core Viewpoint - Forum Energy Technologies, Inc. will present at the 17th Annual Southwest IDEAS Investor Conference on November 19, 2025, at 10:35 a.m. Central Time, indicating the company's engagement with investors and the market [1]. Company Information - Neal Lux, the President and CEO of Forum Energy Technologies, will be the presenter at the conference, highlighting the leadership's involvement in investor relations [1]. - The event is open access, allowing interested parties to register, which reflects the company's commitment to transparency and accessibility for investors [1]. Event Details - The conference will take place on November 19, 2025, at 10:35 a.m. Central Time, providing a specific timeframe for stakeholders to tune in [1]. - A live webcast and presentation slides will be available on the company's website, ensuring that the information is readily accessible to a wider audience [1].

Revenue Performance - For the three months ended September 30, 2025, total revenue was $196.2 million, a decrease of $11.6 million, or 5.6%, compared to the same period in 2024[105]. - The Drilling and Completions segment generated revenue of $117.5 million, down $6.1 million, or 5.0%, from the prior year, primarily due to a decline in global drilling activity[105]. - The Artificial Lift and Downhole segment reported revenue of $79.0 million, a decrease of $5.2 million, or 6.2%, attributed to tariff impacts and lower market activity[106]. - Revenue for the nine months ended September 30, 2025 was $589.3 million, a decrease of $26.1 million, or 4.2%, compared to $615.4 million for the same period in 2024[115]. - Drilling and Completions segment revenue was $350.3 million for the nine months ended September 30, 2025, a decrease of $9.4 million, or 2.6%, compared to $359.7 million for the same period in 2024[115]. - Artificial Lift and Downhole segment revenue was $239.3 million for the nine months ended September 30, 2025, a decrease of $16.4 million, or 6.4%, compared to $255.7 million for the same period in 2024[116]. Operating Performance - The operating loss for the Drilling and Completions segment was $13.55 million, compared to an operating income of $7.03 million in Q3 2024, reflecting a significant decline[104]. - Segment operating loss for the three months ended September 30, 2025 was $10.2 million, a decrease of $19.6 million compared to income of $9.4 million for the same period in 2024, resulting in an operating margin percentage of (5.2)% compared to 4.5%[107]. - Segment operating income for the nine months ended September 30, 2025 was $6.9 million, a decrease of $20.9 million compared to $27.9 million for the same period in 2024, with an operating margin percentage of 1.2% compared to 4.5%[117]. Net Loss and Financial Position - The company reported a net loss of $20.55 million for the three months ended September 30, 2025, compared to a net loss of $14.82 million in the same period last year, representing a 38.7% increase in losses[104]. - Net cash provided by operating activities decreased to $48.0 million for the nine months ended September 30, 2025, down from $53.7 million in the same period of 2024, reflecting a decline of approximately 13%[130]. - Net working capital provided cash of $18.6 million in 2025, compared to $30.8 million in 2024, indicating a decrease of about 40%[130]. - The net decrease in cash, cash equivalents, and restricted cash was $12.97 million in 2025, slightly higher than the decrease of $12.85 million in 2024[129]. Orders and Market Activity - Total inbound orders for the three months ended September 30, 2025, were $239.99 million, a decrease from $263.13 million in the previous quarter[103]. - The global active rig count decreased by 7.7% in Q3 2025 compared to Q3 2024, driven by lower oil prices and increased production efficiencies[99]. - The average number of active drilling rigs in the U.S. was 540 in Q3 2025, down from 586 in Q3 2024[103]. - Average global oil prices for WTI were $65.78 per barrel in Q3 2025, down from $76.43 in Q3 2024, while average natural gas prices at Henry Hub increased to $3.03 per Mcf from $2.11[100]. Capital Expenditures and Share Repurchase - The company expects total capital expenditures for 2025 to be below $10.0 million, primarily for replacement of end-of-life machinery and equipment[126]. - The company repurchased 966 thousand shares of common stock for approximately $21.3 million during the nine months ended September 30, 2025, with remaining authorization under the repurchase program of $53.7 million[128]. - The company repurchased $21.1 million in stock during the nine months ended September 30, 2025, compared to $73.0 million in repurchases of 9.00% Senior Convertible Secured Notes in 2024[132]. Tax and Interest Expenses - Interest expense for the nine months ended September 30, 2025 was $14.1 million, a decrease of $11.0 million compared to $25.1 million for the same period in 2024, due to decreased borrowings[121]. - Tax expense for the nine months ended September 30, 2025 was $20.1 million, an increase of $9.4 million compared to $10.6 million for the same period in 2024[123]. Cash Flow Activities - Net cash provided by investing activities was $10.3 million in 2025, primarily from $14.6 million in sale-leaseback transactions, contrasting sharply with a net cash outflow of $155.9 million in 2024 due to the Variperm acquisition[131]. - Net cash used in financing activities was $72.4 million in 2025, a significant change from the $89.4 million cash inflow in 2024, primarily due to $47.6 million in net repayments of the revolving Credit Facility[132]. Accounting and Controls - There were no material changes in critical accounting policies and estimates during the nine months ended September 30, 2025[133]. - The company's disclosure controls and procedures were evaluated as effective at the reasonable assurance level as of September 30, 2025[135]. - No changes in internal control over financial reporting were reported that materially affected the company's financial reporting during the quarter ended September 30, 2025[136].

Core Insights - Forum Energy Technologies, Inc. demonstrated strong performance in Q3 2025, achieving significant capital returns and maintaining a positive outlook for long-term growth [1][5][28] - The company outperformed the 2,000 small cap index in revenue and free cash flow growth over the past three years, with a notable increase in backlog by 21%, the highest since 2015 [1][5][6] - The "beat the market" strategy, focusing on new product development and targeted commercial efforts, has driven strong bookings and backlog growth [1][7] Financial Performance - Q3 2025 revenue reached $196 million, nearing the top end of guidance, with offshore revenue contributing 22% of total revenue [16][19] - Free cash flow increased by 23% to $28 million, marking the ninth consecutive quarter of positive free cash flow, with a year-to-date increase of 21% [5][24] - The company raised its full-year free cash flow guidance to between $70 million and $80 million, with net debt reduced by nearly 10% to $114 million [6][25] Market Strategy - Forum Energy Technologies, Inc. categorizes its markets into leadership and growth markets, with leadership markets valued at $1.5 billion and a 36% market share [8][10] - The growth markets, approximately $3 billion in size, present opportunities for rapid revenue increase, with a current market share of around 8% [10][12] - The company aims to double its market share in growth markets from 8% to 16%, potentially increasing revenue by $250 million in a flat market scenario [13] Product Development and Innovation - Key products such as coiled line pipe and artificial lift technologies are expected to drive future growth, with coiled line pipe revenue growing 28% sequentially [11][12] - The company is focused on expanding its product offerings, including advancements in artificial lift applications and new technologies for ROVs [43][48] - Forum Energy Technologies, Inc. is also exploring adjacent markets, including defense, to further diversify its revenue streams [48][49] Operational Efficiency - The company is consolidating manufacturing facilities to reduce overhead costs and improve efficiency, with expected annualized cost savings of approximately $15 million by 2026 [23][24] - Ongoing cost reduction initiatives and favorable product mix contributed to an increase in EBITDA margins, which improved by 150 basis points to nearly 12% [19][21] - The company is actively managing tariff impacts through pricing adjustments and leveraging its global footprint to maintain competitiveness [22][21]

Financial Data and Key Metrics Changes - Company reported revenue of $196 million for Q3 2025, approaching the top end of guidance, with a 13% increase in consolidated EBITDA to $23 million, exceeding expectations [13][16] - Free cash flow increased by 23% to $28 million, enabling significant shareholder returns and raising full-year guidance to $70 million to $80 million [19][20] - Net leverage ratio improved to 1.3 times, one quarter ahead of schedule, with net debt reduced by nearly 10% to $114 million [20] Business Line Data and Key Metrics Changes - Offshore revenue grew to 22% of total revenue, driven by increases in drilling and subsea product lines, while U.S. revenue declined by 10% due to a 5% drop in rig count [13][14] - Coiled Line Pipe sales increased by 28%, contributing to market share gains, while the subsea product line revenue rose by 5% [16][9] - Artificial lift and down-hole segment revenue decreased by 4%, but EBITDA increased by 2% due to favorable product mix and cost savings [17] Market Data and Key Metrics Changes - International revenue surpassed U.S. sales, with Middle East and Canadian revenue each increasing by over 10% [13] - Book-to-bill ratio was 122%, indicating strong demand across segments, with subsea bookings exceeding 200% [14][15] - U.S. rig count decline impacted overall revenue, but international markets showed resilience [13] Company Strategy and Development Direction - Company aims to double revenue by 2030 through a "beat-the-market" strategy, focusing on targeted markets and differentiated technologies [10][11] - Leadership markets estimated at $1.5 billion with a 36% market share, while growth markets are approximately $3 billion with an 8% market share [7][8] - Strategic consolidation of manufacturing facilities is expected to enhance efficiency and reduce costs, with anticipated annualized savings of $15 million [18][19] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about long-term growth despite current market challenges, emphasizing the need for efficiency in a potentially lower oil price environment [60][62] - The company is well-positioned for 2026 with a strong backlog and ongoing market share gains [12][46] - Management highlighted the importance of new product development to drive future growth, particularly in artificial lift and subsea technologies [49][56] Other Important Information - Company repurchased 635,000 shares for $15 million in Q3, totaling 8% of shares outstanding for the year [20] - Increased tariffs on steel imports have been a challenge, but the company is implementing strategies to mitigate these impacts [17][18] Q&A Session Summary Question: Changes in sales incentive systems - Management indicated ongoing improvements in sales processes and alignment with the beat-the-market strategy have contributed to increased bookings [30] Question: Margins in backlog and new orders - Management noted that the mix of bookings, particularly from subsea, may exert downward pressure on margins, but cost-saving initiatives will provide benefits [31] Question: Revenue-generating potential of manufacturing base post-consolidation - Management expressed confidence in the ability to grow revenue significantly despite facility consolidations, maintaining capacity for a 50% revenue increase [32] Question: Share repurchase capacity - Management confirmed that share repurchase capacity is limited by net leverage and free cash flow, with approximately $15 million available for Q4 [34] Question: Cycle status in different geographies - Management emphasized opportunities exist across all markets, with a focus on leveraging successful products globally [43] Question: Growth potential of Coiled Line Pipe - Management acknowledged the potential for significant growth in Coiled Line Pipe, with a goal to double market share over time [47] Question: New product introductions for 2026 - Management highlighted ongoing development in artificial lift and subsea technologies, with promising new products expected to drive growth [49] Question: Impact of lower oil prices on technology adoption - Management indicated that lower oil prices could increase demand for efficiency-enhancing products, positioning the company favorably [53] Question: Backlog timing and revenue recognition - Management noted that a significant portion of the backlog will be recognized over the next few quarters, with some projects extending into 2027 [63]