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The Zacks Oil and Gas - Drilling industry is weighed down by uncertainty and volatility. Customers are pulling back on spending as shifting oil prices, geopolitical risks and trade tensions cloud visibility. Contracting activity has slowed, and while projects are still in play, many operators are deferring work to protect balance sheets. At the same time, oversupply risk persists, with idle rigs and softer day rates threatening margins if activity fails to pick up. Yet, the longer-term story isn’t all bleak ...

Core Insights - Helmerich & Payne, Inc. (HP) reported a fiscal third-quarter 2025 adjusted net income of 22 cents per share, exceeding the Zacks Consensus Estimate of 20 cents, but down significantly from 92 cents in the same quarter last year due to weakness in the International Solutions segment [1][10] Financial Performance - Operating revenues reached $1 billion, surpassing the Zacks Consensus Estimate by $42 million, with Drilling Services sales increasing by 49.1% year-over-year [2][10] - The company distributed approximately $25 million to shareholders as part of its ongoing dividend program [2] Debt and Capital Management - As of the end of July, the company repaid $120 million of its $400 million term loan and expects to repay an additional $200 million by the end of calendar year 2025, an increase from the previous expectation of $175 million [3] - In the reported quarter, HP spent $362.2 million on capital programs, with cash and cash equivalents totaling $166.1 million and long-term debt at $2.2 billion, resulting in a debt-to-capitalization ratio of 43.3% [8] Segment Performance - North America Solutions reported operating revenues of $592.2 million, down 4.5% year-over-year, with an operating profit of $157.6 million, which beat estimates [5] - International Solutions saw operating revenues of $265.8 million, a 455.1% increase from the previous year, but incurred an operating loss of $166.5 million, impacted by a one-time goodwill impairment loss of $128 million [6] - Offshore Solutions revenues increased by 494.4% to $161.8 million, with an operating profit of $8.8 million, although it missed estimates [7] Synergies and Future Guidance - The quarter marked the first full impact of the KCA Deutag acquisition, with HP identifying about $50 million in cost synergies towards a goal of $50-$75 million [4][10] - For fiscal Q4 2025, the company expects direct margins for North America Solutions to be between $230 million and $250 million, while International Solutions is projected to have direct margins between $22 million and $32 million [11][12]

Financial Data and Key Metrics Changes - The company generated quarterly revenues of just over $1 billion for the second consecutive quarter [18] - Total direct operating costs were $735 million, and general and administrative expenses were approximately $66 million, representing a reduction of $15 million from the previous quarter [19] - EBITDA increased to $268 million from $242 million in the last quarter [20] Business Line Data and Key Metrics Changes - North American Solutions averaged 147 contracted rigs during the quarter, with a direct margin of $266 million, consistent with the previous quarter [20][21] - International Solutions ended the quarter with 69 rigs working, generating direct margins of $34 million, up $7 million from the second quarter [22] - Offshore Solutions segment generated $23 million in direct margins, benefiting from the inclusion of KCAD's offshore business [22] Market Data and Key Metrics Changes - The Permian Basin saw a 12% year-over-year decline in total rig count, while the company's market share in the region grew by over three percentage points [11] - The company is active in nearly all major basins outside of Russia and China, with growth opportunities identified in South America and other key markets [12] Company Strategy and Development Direction - The company remains focused on executing its global strategy to stay at the forefront of the drilling solutions industry, emphasizing customer-centric solutions and technological advancements [6][16] - The integration of KCAD is progressing well, with significant cost synergies already identified [15][28] - The company aims to leverage its broader operational footprint and expanded customer base to differentiate itself on the global stage [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing challenges from volatile oil and natural gas prices but expressed confidence in the company's strategic initiatives and operational performance [5][6] - The outlook for growth in Saudi Arabia and the Middle East is positive, with expectations for increased activity in 2026 [14][33] - Management remains cautious about the impact of tariffs and commodity price fluctuations on future performance [21] Other Important Information - The company recorded an impairment of a significant part of the goodwill from the KCAD acquisition, primarily due to a drop in equity price [23] - The company expects to pay down $200 million on its term loan by the end of the calendar year, reflecting improved cash flow generation [29] Q&A Session Summary Question: Growth in international business from fiscal fourth quarter - Management indicated that there are opportunities for growth in Saudi Arabia, with tenders expected to emerge in 2026 [30][33] Question: Ongoing conversations about suspended rigs - Management noted that the worst is behind them, but the timing for resuming operations remains uncertain, likely pushing into 2026 [37] Question: Adoption of performance contracts - Management highlighted that performance contracts are being adopted by a range of customers, including small privates and large majors, with ongoing interest in international markets [42][46] Question: Rig count guidance and market share - Management explained that the guidance for rig count reflects a combination of effective churn management and potential new rig additions [60][90] Question: Competitive landscape and pricing pressures - Management acknowledged industry-wide pricing pressures but emphasized that they price based on the value delivered to customers [91][92]

Company Overview - Helmerich & Payne (H&P) is a premier U S driller with 141 active rigs and a strong global presence with 62 active rigs[10] - The company has exposure to all major oil and gas regions, including the U S, Middle East, North Africa, and Argentina[10] - H&P has a durable and capital light offshore business with 36 offshore rigs and management contracts[10] Financial Performance - H&P achieved a direct margin of $266 million, significantly exceeding quarterly expectations[12] - The company's consolidated adjusted EBITDA was $268 million[12] - H&P repaid $120 million in debt through July, with $200 million in repayments expected by the end of 2025[12] Operational Highlights - Approximately 50% of active rigs are utilizing performance contracts, incentivizing win-win results with customers[12] - H&P's Permian market share is up to 37%, with a focus on customer alignment delivering value[17] - The company has identified over $50 million of an upwardly revised $50 to $75 million cost reduction target[12] Future Outlook - H&P anticipates a direct margin of $230-$250 million for North America Solutions in Q4 Fiscal 2025[22] - The company expects gross capital expenditures of $380-$395 million for the full fiscal year 2025[22] - H&P is focused on debt reduction, targeting $200 million by the end of 2025[26]

Helmerich & Payne (HP -0.77%), a leading provider of drilling services and advanced land rigs, released its earnings for the third quarter of fiscal 2025 on August 6, 2025. The company posted non-GAAP earnings per share of $0.22, beating analysts' expectations of $0.18 non-GAAP EPS. Revenue for the period reached $1,040.9 million (GAAP), and growing sharply from the $697.7 million (GAAP) recorded in Q3 FY2024. Despite the strong headline revenue and EPS results, net income (GAAP) was negative due to a $173 ...

Core Insights - Helmerich & Payne reported revenue of $1.04 billion for the quarter ended June 2025, marking a 49.2% increase year-over-year, with an EPS of $0.22 compared to $0.92 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $999.23 million by 4.17%, and the EPS also surpassed the consensus estimate of $0.20 by 10% [1] Financial Performance - The company experienced a -9.6% return on shares over the past month, while the Zacks S&P 500 composite saw a +0.5% change [3] - Helmerich & Payne holds a Zacks Rank 4 (Sell), indicating potential underperformance against the broader market in the near term [3] Key Metrics - Average active rigs in North America Solutions were 147, slightly above the estimated 145 [4] - Average active rigs in Offshore Solutions matched the estimate at 3, while International Solutions had 72 active rigs, below the estimated 77 [4] - Operating revenues for North America Solutions were $592.21 million, exceeding the estimated $568.49 million but reflecting a -4.5% change year-over-year [4] - Offshore Solutions reported operating revenues of $161.78 million, significantly above the estimated $148.89 million, with a remarkable +494.4% change year-over-year [4] - International Solutions generated $265.8 million in operating revenues, slightly below the estimated $277.25 million, but showing a +455.1% year-over-year change [4] - Overall, drilling services reported operating revenues of $1.04 billion, surpassing the $1 billion estimate, with a year-over-year increase of +49.3% [4] - Other revenues were reported at $3.05 million, significantly below the estimated $25.24 million, but reflecting a +17.9% change year-over-year [4]

Group 1: Earnings Performance - Helmerich & Payne reported quarterly earnings of $0.22 per share, exceeding the Zacks Consensus Estimate of $0.20 per share, but down from $0.92 per share a year ago, representing an earnings surprise of +10.00% [1] - The company posted revenues of $1.04 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.17%, compared to revenues of $697.72 million in the same quarter last year [2] Group 2: Stock Performance and Outlook - Helmerich & Payne shares have declined approximately 51.3% since the beginning of the year, contrasting with the S&P 500's gain of 7.1% [3] - The current consensus EPS estimate for the upcoming quarter is $0.14 on revenues of $968.96 million, and for the current fiscal year, it is $1.10 on revenues of $3.66 billion [7] Group 3: Industry Context - The Oil and Gas - Drilling industry, to which Helmerich & Payne belongs, is currently ranked in the bottom 15% of over 250 Zacks industries, indicating potential challenges for stock performance [8]

Exhibit 99.1 NEWS RELEASE August 6, 2025 HELMERICH & PAYNE, INC. ANNOUNCES FISCAL THIRD QUARTER RESULTS Operating and Financial Highlights for the Quarter Ended June 30th, 2025 Helmerich & Payne | 222 N. Detroit Ave. | Suite 1100 Tulsa, OK 74120 | 918.588.5190 | helmerichpayne.com • The Company realized a consolidated net loss of $(163) million, or $(1.64) per share, which includes the impact of a non-cash goodwill impairment charge of $173 million. Adjusted for this and other non-recurring one-time items, ...

Group 1 - The article emphasizes that as stock market values increase, it becomes more challenging to identify worthwhile investment opportunities or "bargains" [1] Group 2 - The article does not provide specific company or industry insights, focusing instead on general investment principles and disclosures [2][3]