Highly Confidential | 1 Innovex International Q3 2024 Earnings Presentation Disclaimer Important Information and Disclaimers This disclaimer applies to this document and the verbal or written comments of any person presenting it. This document, taken together with any such verbal or written comments, is referred to herein as the "Presentation." Historical financial results presented in this Presentation as averages or annualized forms are not necessarily indicative of results that may be expected for any fu ...

Financial Performance - Innovex reported a strong financial performance with a net cash position supporting long-term growth[10]. - Q3 2024 revenue reached $152 million, representing a 17% increase quarter over quarter[16]. - Adjusted EBITDA for Q3 2024 was $27 million, with an adjusted EBITDA margin of 18%[16]. - Free cash flow for Q3 2024 amounted to $20 million[16]. - Total cash on the balance sheet is $100 million, with total debt of $23 million, resulting in net cash of $77 million[18]. - Revenue for Legacy Innovex in 2023 is projected at $556 million, an increase from $467 million in 2022[32]. - Free cash flow for Q3 2023 was $26 million, with cash flow from operating activities at $32 million[29]. - Legacy Dril-Quip's revenue for 2023 is projected at $478 million, up from $362 million in 2022[34]. - The combined net income for 2023 is projected at $98 million, with adjusted EBITDA totaling $221 million[35]. Growth Strategy - The company aims to create a unique energy industrial platform focused on delivering exceptional value and returns for shareholders[10]. - The company emphasizes disciplined acquisitions and divestitures as part of its growth strategy[12]. - The merger with Dril-Quip closed on September 6, 2024, with Legacy Dril-Quip stockholders owning approximately 52% of the combined entity[14]. - The company has been renamed Innovex International, Inc., with the ticker changed from DRQ to INVX[14]. - Expected annual cost synergies of at least $30 million, with 50% anticipated to be realized within 12 months and 100% within 24 months[20]. - Achieved the first $15 million of cost synergies in year 1, with a clear path to achieving the full $30 million within the projected timeframe[20]. - The company aims to leverage combined infrastructure to expand product offerings in growing markets such as Saudi Arabia, Mexico, and Asia Pacific[20]. Operational Model - Innovex's Return on Capital Employed (ROCE) model emphasizes capital light, high return operations, defined as income from operations before acquisition costs divided by average capital employed[11]. - The company maintains a diversified presence across attractive global markets, enhancing its competitive position[11]. - Innovex's culture promotes innovation and rapid response to market needs, fostering a customer-centric approach[12]. - Innovex's operational model is characterized by a flat, lean organization that minimizes bureaucracy[12]. - The company focuses on a curated portfolio of complementary, mission-critical products to drive growth[11]. Financial Guidance - The management provided an outlook regarding Adjusted EBITDA, a non-GAAP financial measure, but did not provide specific guidance due to uncertainties[8]. - Q4 2024 revenue guidance is projected between $220 million and $230 million[16]. - Q4 2024 adjusted EBITDA is expected to be between $35 million and $40 million[16]. - The market assumption for Q4 2024 indicates flat activity compared to Q3 2024[16]. - Legacy Innovex is the accounting acquirer in the merger, affecting the presentation of financials going forward[15]. Synergy and Margin Improvement - Combined company expected to have an implied $58 million adjusted EBITDA opportunity if legacy Dril-Quip margins improve to legacy Innovex levels[20]. - 2023 adjusted EBITDA margin for the combined company projected to be 24%, up from 22% in 2022[32]. - Adjusted EBITDA for Legacy Dril-Quip in 2023 is projected at $59 million, with a margin of 12%[34].