Financial Data and Key Metrics Changes - Revenue increased by 51% over the last three years, with a 10% growth in 2024 [10][12] - EBITDA grew by 49% in 2024, resulting in a 42% incremental margin and over 300 basis points margin improvement [12] - Free cash flow reached $105 million, the highest since 2015, exceeding guidance by $35 million [28] - Net debt decreased by 30%, improving net leverage from 11 times to just under 1.5 times [11][36] Business Line Data and Key Metrics Changes - Drilling and Completion segment revenue decreased by 10% due to lower US completions activity, with EBITDA down 34% [40] - Artificial Lift and Downhole segment revenue increased by 7%, driven by higher sales of refinery desalting technology and artificial lift products, leading to an 11% EBITDA growth [41] Market Data and Key Metrics Changes - Global drilling and completion activity is expected to decline by 2% to 5% in 2025, with North America forecasted to soften in rig and frac fleet counts [19] - International revenue grew by almost 42%, indicating strong performance outside the US [16] Company Strategy and Development Direction - The company aims to capture profitable market share through a "beat the market" strategy, focusing on differentiated technologies and global footprint [15][18] - Continued investment in energy is anticipated, with a focus on long-term demand growth despite expected transitional challenges in 2025 [18] Management's Comments on Operating Environment and Future Outlook - Management expects 2025 to be a transitional year due to geopolitical and macroeconomic uncertainties, with a forecasted decline in market activity [18] - The company is monitoring natural gas demand and tariff impacts closely, indicating potential upside if commodity prices rise [21][22] Other Important Information - A $75 million share repurchase program was authorized, reflecting confidence in generating consistent free cash flow [14] - The company has no debt maturities until 2028, with total liquidity of $106 million [36] Q&A Session Summary Question: Inquiry about new product related to mobile power - Management confirmed the introduction of Powertron, a heat exchanger for the power generation market, with strong quotation activity [50] Question: Thoughts on future orders for wireline completion - Management indicated that consumables are being consumed well, with potential spikes in capital-type products expected in the coming quarters [54] Question: Guidance on EBITDA amidst market weakness - Management explained that EBITDA guidance reflects the ability to offset market declines through market share gains [62] Question: Areas for growth in market share - Focus on high-margin product lines such as artificial lift and downhole, with ongoing development of new products [70] Question: Impact of tariffs on Canadian operations - Management noted no current impact from tariffs in Canada, but acknowledged potential future adjustments if tariffs are implemented [81] Question: Plans for returning cash to shareholders - Management emphasized the focus on share repurchases over dividends due to the undervaluation of the company's stock [75] Question: Future acquisition opportunities - Management expressed openness to pursuing acquisitions if they present relative value compared to share buybacks [90]

Financial Performance - Fourth quarter 2024 revenue was $201 million, with a net loss of $104 million, including a non-cash impairment of $119 million[1]. - Full year 2024 revenue reached $816 million, a 10% year-over-year increase, with adjusted EBITDA of $100 million, a 49% increase from 2023[3]. - The net loss for 2024 was $135 million, or $11.00 per diluted share, compared to a net loss of $18.9 million in 2023[17]. - The company reported a net loss of $135.3 million for the year ended December 31, 2024, compared to a net loss of $18.9 million in 2023[21]. - Total revenue for the year ended December 31, 2024, was $816.4 million, an increase from $738.9 million in 2023, representing an increase of approximately 10.5%[25]. - The total EBITDA for the year ended December 31, 2024, was $(43.2) million, compared to $45.2 million in 2023, reflecting a significant decline[25]. - For the three months ended December 31, 2024, the company reported an operating loss of $106.8 million, representing a 53.1% loss margin on revenue[30]. - The net income for the same period was a loss of $88.7 million, compared to a loss of $16.8 million in the prior year, indicating a significant decline in profitability[30]. - Adjusted EBITDA for Q4 2024 was $8.1 million, or 4.0% of revenue, while the adjusted net loss was $5.9 million[30]. Cash Flow and Capital Management - Operating cash flow for 2024 was $92 million, and free cash flow was $105 million, the highest since 2015[1]. - The company expects to allocate 50% of free cash flow to net debt reduction and the remainder to strategic investments, including share repurchases[2]. - Free cash flow before acquisitions for Q4 2024 was $56.9 million, a substantial increase from $8.9 million in Q4 2023[39]. - Free cash flow before acquisitions for the year ended December 31, 2024, was $105.1 million, a significant increase from $1.6 million in 2023[41]. - The company had capital expenditures of $8.1 million for property and equipment in 2024, slightly up from $7.9 million in 2023[21]. - The company’s capital expenditures for property and equipment in Q4 2024 were $(2.4) million, reflecting ongoing investment in operational capabilities[39]. Segment Performance - The Drilling and Completions segment revenue decreased by 10% to $111 million, while the Artificial Lift and Downhole segment revenue increased by 7% to $90 million[5][6]. - Operating income for the Drilling and Completions segment was $17.8 million with an operating margin of 3.8% for the year ended December 31, 2024, compared to $19.4 million and 3.9% in 2023[25]. - The Artificial Lift and Downhole segment reported an operating income of $48.9 million with a margin of 14.1% for the year ended December 31, 2024, up from $31.6 million and 13.4% in 2023[25]. - Revenue from the Drilling segment for the three months ended December 31, 2024, was $35.5 million, accounting for 17.6% of total revenue, compared to $41.6 million and 22.5% in 2023[44]. - The Subsea segment generated $18.6 million in revenue for the three months ended December 31, 2024, a decrease from $27.6 million in 2023, reflecting a decline of 32.5%[44]. - Revenue from the Stimulation and Intervention segment was $31.1 million, representing 15.5% of total revenue, compared to $32.1 million and 17.3% in the previous year[44]. - The Drilling and Completions segment contributed $111.1 million, or 55.3% of total revenue, down from $126.6 million and 68.4% in 2023[44]. - Downhole revenue increased to $51.5 million, representing 25.6% of total revenue, compared to $21.7 million and 11.7% in the same period of 2023[44]. - The Artificial Lift and Downhole segment saw revenue of $89.9 million, a significant increase from $58.6 million in 2023, representing a growth of 53.3%[44]. Market Demand and Strategic Initiatives - The "Beat the Market" strategy led to a 15% market share growth as measured by revenue per global rig[4]. - Total orders for the three months ended December 31, 2024, were $190.0 million, compared to $160.3 million in the same period of 2023, indicating a year-over-year increase of approximately 18.6%[27]. - The book-to-bill ratio for total orders was 0.95 for the three months ended December 31, 2024, compared to 0.87 in the same period of 2023, suggesting improving market demand[27]. - The company highlighted strategic opportunities for future growth, including potential acquisitions and investments in business expansion[30]. Impairments and Losses - The company incurred $119.1 million in impairment of intangible assets during the year ended December 31, 2024[21]. - The company incurred $119.1 million in impairment of intangible assets during the quarter, which heavily impacted the financial results[30]. - The diluted EPS as reported for Q4 2024 was $(8.39), while the adjusted diluted EPS was $(0.48)[30].

Core Insights - Laurentian Research is a veteran in the resource industry with a Ph.D. in geoscience and extensive investment experience [1] - The Natural Resources Hub aims to help members identify undervalued opportunities in the energy and mining sectors with significant growth potential [1] - The platform offers various resources including weekly newsletters, in-depth analyses, trade alerts, model portfolios, and a community for sharing investment ideas [2][3] Group 1 - The Natural Resources Hub focuses on uncovering multi-bagger potential in energy and mining sectors [1] - The service is designed to assist members in finding dividend growth opportunities from long-term growth industries [1] - Members benefit from private access to Laurentian Research and a supportive community of fellow investors [2][3]

Stonegate Capital Partners Updates Coverage on Forum Energy Technologies, Inc. (FET) Q3 24November 04, 2024 5:54 PM EST | Source: Reportable, Inc.Dallas, Texas--(Newsfile Corp. - November 4, 2024) - Forum Energy Technologies, Inc. (NYSE: FET) Stonegate Capital Partners updates their coverage on Forum Energy Technologies, Inc. (NYSE: FET). FET reported revenue, adj EBITDA, and adj net income of $207.8M, $25.8M, and ($2.3)M, respectively. This compares to our/consensus estimates of $211.3M/$214. ...

Revenue Performance - For the nine months ended September 30, 2024, approximately 80% of the company's revenue was derived from consumable products and activity-based equipment[70]. - Total revenue for the three months ended September 30, 2024, was $207.8 million, an increase of $28.6 million, or 15.9%, compared to the same period in 2023[83]. - Revenue from the Drilling and Completions segment was $123.6 million, up $4.7 million, or 3.9%, driven by a $6.2 million increase in the Subsea product line[83]. - Revenue from the Artificial Lift and Downhole segment was $84.2 million, an increase of $23.9 million, or 39.5%, primarily due to a $27.1 million increase from the acquired Variperm business[83]. - Total revenue for the nine months ended September 30, 2024, was $615.4 million, an increase of $61.7 million, or 11.2%, compared to the same period in 2023[92]. - The Drilling and Completions segment generated revenue of $359.7 million, a decrease of $16.3 million, or 4.3%, while the Artificial Lift and Downhole segment saw revenue of $255.7 million, an increase of $78.1 million, or 43.9%[92]. - Revenue for the three months ended September 30, 2024, was $126.7 million, a decrease of 4.0% from $133.2 million in the same period of 2023[107]. Orders and Activity Levels - Total inbound orders for the Drilling and Completions segment were $129.5 million for Q3 2024, compared to $139.9 million in Q3 2023[80]. - The Artificial Lift and Downhole segment reported total orders of $76.3 million in Q3 2024, up from $58.9 million in Q3 2023[80]. - The average number of active drilling rigs in the U.S. was 586 in Q3 2024, down from 649 in Q3 2023[79]. - The global active rig count decreased by 3.1% in Q3 2024 compared to Q3 2023, with a notable decline of 9.7% in the U.S. rig count[76]. - The company anticipates that activity levels in the U.S. will remain depressed in Q4 2024 and into 2025, while international growth is expected to decline[76]. Financial Performance - Segment operating income for the three months ended September 30, 2024, was $9.4 million, a $3.9 million increase compared to $5.5 million in 2023[84]. - The operating margin percentage improved to 4.5% for the three months ended September 30, 2024, compared to 3.1% in the same period of 2023[84]. - Interest expense increased to $7.7 million, up $3.1 million compared to the same period in 2023, due to increased borrowings related to the Variperm acquisition[87]. - The company recorded a net loss of $14.8 million for the three months ended September 30, 2024, compared to a net income of $8.0 million in 2023, representing a decrease of $22.8 million[83]. - The tax expense for the three months ended September 30, 2024, was $4.6 million, compared to $1.5 million in 2023, reflecting a significant increase[88]. - Operating income for the nine months ended September 30, 2024, was a loss of $15.2 million, compared to an operating income of $14.9 million for the same period in 2023[107]. - Net loss for the nine months ended September 30, 2024, was $31.8 million, compared to a net loss of $2.1 million for the same period in 2023[107]. Cash Flow and Capital Expenditures - Net cash provided by operating activities was $53.7 million for the nine months ended September 30, 2024, compared to a net cash used of $3.1 million for the same period in 2023, reflecting an improvement of $56.8 million[102]. - Net cash used in investing activities was $155.9 million for the nine months ended September 30, 2024, primarily due to the Variperm Acquisition of $150.4 million[103]. - Net cash provided by financing activities was $89.4 million for the nine months ended September 30, 2024, compared to cash used of $6.9 million for the same period in 2023, indicating a change of $96.3 million[104]. - Total capital expenditures for 2024 are expected to be approximately $10.0 million, primarily for replacing end-of-life machinery and equipment[98]. Acquisition and Segment Structure - Following the Variperm Acquisition, the company now operates in two reportable segments: Drilling and Completions, and Artificial Lift and Downhole[72]. - The company completed the Variperm acquisition in January 2024 for approximately $150.0 million in cash and 2.0 million shares of common stock[100]. Balance Sheet and Liabilities - Current assets as of September 30, 2024, were $345.1 million, down from $388.8 million as of December 31, 2023[107]. - Current liabilities increased to $201.4 million as of September 30, 2024, compared to $144.5 million as of December 31, 2023[107]. - Non-current liabilities rose to $207.5 million as of September 30, 2024, compared to $178.8 million as of December 31, 2023[107]. Market Outlook - The company expects long-term energy demand to continue rising, with hydrocarbons playing a vital role alongside renewable energy sources[71]. - The decline in U.S. drilling activity and lower revenues in the Production Equipment product line partially offset the overall revenue increase[83].

Financial Data and Key Metrics Changes - The company reported consolidated revenue of $208 million, up 16% year-over-year, and EBITDA increased by 55% over the same period, with EBITDA margins year-to-date at 13%, the strongest in nearly a decade [30][36] - Free cash flow generated in the first nine months of 2024 was $48 million, leading to an increased cash flow forecast for the year to between $60 million and $70 million, translating to a range of $4.90 to $5.70 per share [11][30] - Net debt decreased to $199 million, down $26 million from the previous quarter, resulting in a net leverage ratio of 1.9x [36][80] Business Line Data and Key Metrics Changes - The Drilling and Completion segment revenue increased by 6%, driven by higher project revenue from ROVs and launch and recovery systems, while EBITDA was $15 million, up 26% [33] - The Artificial Lift and Downhole segment revenue was $84 million, down 5%, with EBITDA at $17 million, down 12%, attributed to lower casing hardware volume and valve product sales [34] - Variperm's revenue increased by 2% sequentially, with a strong outlook despite project timing impacts [35][52] Market Data and Key Metrics Changes - The company noted a cautious market outlook for the fourth quarter, with expectations of slower U.S. demand due to budget exhaustion and holiday disruptions, while international and offshore activity is expected to mitigate this softness [20][22] - Economic stability and investment growth in Argentina were highlighted, with expectations of a 10% to 15% increase in activity next year [19] Company Strategy and Development Direction - The company is focused on a "beat the market" strategy, which includes growing profitable market share, developing differentiated products, and expanding participation in energy transition [12] - New product innovations include the MagnaGuard for permanent magnet motor ESPs and the Unity operating system for remotely controlling ROVs, aimed at enhancing safety and operational efficiency [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate free cash flow and return capital to shareholders, despite uncertainties in commodity prices and market activity [20][22] - For 2025, management anticipates a potential 5% decrease in U.S. drilling and completions activity, but remains focused on free cash flow and shareholder returns [22][69] Other Important Information - The company successfully completed a $100 million senior secured bond offering, which will allow for the payoff of 2025 notes and seller term loans, enhancing liquidity and extending debt maturities [8][25] - The company expects to communicate a shareholder return framework in February [29] Q&A Session Summary Question: Guidance on free cash flow - Management indicated that the guidance is based on fixed cash obligations and potential growth from their "beat the market" strategy [39][40] Question: M&A strategy - Management is open to acquisitions similar to Variperm, focusing on businesses that enhance free cash flow [41][42] Question: Impact of U.S. tariffs on international demand - Management noted that supply chain diversification has mitigated concerns regarding tariffs on raw materials [43] Question: Demand outlook for frac capital equipment - Management prefers to focus on consumable sales rather than capital equipment, but remains open to opportunities in the frac capital space [46] Question: Variperm's revenue outlook - Management expects some project delays to push revenue into 2025, but remains optimistic about future activity [54][56] Question: Balance sheet and liquidity - Management confirmed that they expect to end the year with slightly lower liquidity than the previous quarter due to debt repayments [58] Question: Market opportunities in Canada and the Middle East - Management highlighted strong opportunities in both regions, with a bullish outlook for Canada and ongoing growth in the Middle East [91][92]

Financial Performance - Forum Energy Technologies, Inc. announced preliminary results for Q3 2024, with revenue and Adjusted EBITDA yet to be finalized[3] Bond Offering - The company is contemplating an offering of $100.0 million in USD denominated 5-year senior secured bonds, subject to market conditions[4] - Net proceeds from the bond offering will be used to redeem all outstanding 9.000% Convertible Senior Secured Notes due 2025 and repay borrowings under the seller term loan related to the acquisition of Variperm Energy Services[4]

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HOUSTON, Aug. 27, 2024 (GLOBE NEWSWIRE) -- Forum Energy Technologies, Inc. (NYSE: FET) ("FET"), a global designer, manufacturer and distributor of products to the oil, natural gas, industrial and renewable energy industries, is confirmed to present at the 2024 Annual Gateway Conference, which is being held September 4-5, at the Four Seasons Hotel in San Francisco, CA. FET's management team is scheduled to present on Wednesday, September 4th at 11 a.m. Pacific Time (PT). The presentation will be webcast live ...

Forum Energy Technologies, Inc. (NYSE:FET) Q2 2024 Earnings Conference Call August 2, 2024 11:00 AM ET Company Participants Rob Kukla - Director of IR Neal Lux - President, CEO & Director Lyle Williams - EVP & CFO Conference Call Participants David Storms - Stonegate Capital Markets Daniel Pickering - Pickering Energy Partners Jeffrey Robertson - Water Tower Research Operator Good morning, ladies and gentlemen, and welcome to the Forum Energy Technologies Second Quarter 2024 Earnings Conference Call. My nam ...