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Nabors Industries Ltd. 2nd Quarter 2025 Earnings Conference Call Invitation
Prnewswire· 2025-07-01 20:15
HAMILTON, Bermuda, July 1, 2025 /PRNewswire/ -- Nabors Industries Ltd. (NYSE: NBR) invites you to join Anthony G. Petrello, Chairman, President and Chief Executive Officer, and William Restrepo, Chief Financial Officer, Wednesday, July 30, 2025 at 10:00 a.m. Central Time for a discussion of operating results for the second quarter ended June 30, 2025. Nabors will release earnings after the market closes on July 29, 2025. Date: July 30, 2025 Time: 10:00 a.m. CT (11:00 a.m. ET) Dial-in-number(s) ...
NBR Stock Down 56% in a Year: Should Investors Hold or Move On?
ZACKS· 2025-06-24 13:06
Core Insights - Nabors Industries Ltd. (NBR) has experienced a significant stock decline of 56% over the past year, underperforming compared to peers in the oil and gas drilling sector [1][13] - The company faces multiple operational and financial challenges, raising concerns about its near-term outlook and ability to stabilize and grow [2] Financial Performance - The U.S. Drilling segment reported a decrease in adjusted EBITDA from $105.8 million in Q4 2024 to $92.7 million in Q1 2025, attributed to lower rig counts and operational inefficiencies [3] - Daily margins in the Lower 48 states fell from $14,940 to $14,276 due to increased rig churn, leading to higher costs and contract instability [3][4] - Management anticipates only a marginal recovery in daily margins to $14,100 in Q2 2025, indicating ongoing pressure in the U.S. market, which accounts for 44% of total drilling revenues [4] Geopolitical and Market Risks - Nabors suspended operations in Russia due to U.S. sanctions, incurring $28.6 million in non-cash charges, and does not expect to resume activities there [5] - The company faces challenges in Colombia and Mexico, including delayed customer payments, with 20% of international rigs located in volatile regions, increasing exposure to geopolitical risks [5] Debt and Cash Flow Concerns - Nabors' net debt stood at $2.28 billion in Q1 2025, with adjusted free cash flow showing a usage of $71 million [6] - The company has a capital expenditure target of $770-$780 million for 2025, which includes $360 million for SANAD newbuilds, constraining near-term cash flow [6] - The Parker acquisition added $178 million in debt, and rising interest rates pose refinancing risks, raising concerns about financial stability [6] Dependency on Joint Ventures - The SANAD joint venture is crucial for growth, contributing significantly to international EBITDA, but its success is contingent on Saudi Aramco's capital discipline [7] - Any slowdown in Aramco's gas-focused drilling, which constitutes 75% of SANAD's activity, could jeopardize projections [7] Integration and Operational Challenges - The Parker acquisition, while expected to generate $40 million in synergies, introduces integration complexities and costs, with $14 million incurred in the first quarter [9] - Parker's negative free cash flow of $10 million in Q1 and a $60 million capex target for 2025 further strain liquidity [9] Customer and Revenue Risks - Nabors faces receivables issues, particularly in Mexico, where $20 million in expected collections were delayed [11] - The company's reliance on a few key clients increases vulnerability to payment delays or contract cancellations, contrasting with peers that have diversified their customer bases [11] Market Position and Comparison - Over the past year, Nabors' share price has dropped 56.4%, significantly more than declines of 45.7%, 50.9%, and 39.1% for peers Transocean, Helmerich & Payne, and Patterson-UTI Energy, respectively [13] - The overall Oils-Energy sector saw a rise of 3.6%, highlighting Nabors' underperformance relative to both its industry peers and the broader market [13]
Nabors: Deeply Undervalued After An Acquisition And Investments In Robotic Drilling
Seeking Alpha· 2025-05-18 14:46
Core Insights - Nabors Industries Ltd. (NYSE: NBR) is expected to experience significant revenue growth due to investments in automated drilling and the expansion of the offshore drilling market [1] - The company is anticipated to see growth in free cash flow as a result of recent acquisitions [1] Company Analysis - Nabors Industries is focusing on automated drilling technologies, which positions the company to capitalize on the increasing demand in the offshore drilling sector [1] - The financial analysis includes various metrics such as cash flow statements, unlevered free cash flow, cost of capital, and WACC, which are essential for evaluating the company's future performance [1] Market Context - The offshore drilling market is projected to grow, providing a favorable environment for companies like Nabors Industries that are investing in advanced drilling technologies [1]
Nabors(NBR) - 2025 Q1 - Quarterly Report
2025-05-09 17:40
[Part I - Financial Information](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The financial statements for the quarter ended March 31, 2025, show a significant turnaround to a net income of $57.2 million from a net loss of $9.0 million in the prior-year quarter, largely driven by a $113.0 million bargain purchase gain from the Parker Drilling acquisition. Total assets increased to $5.05 billion from $4.50 billion at year-end 2024, primarily due to the acquisition. Cash from operations was $87.7 million, a decrease from $107.2 million year-over-year, reflecting changes in working capital and lower cash from operating results before these changes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets were $5.05 billion, an increase from $4.50 billion at December 31, 2024. This growth was primarily driven by an increase in Property, Plant, and Equipment and Accounts Receivable, largely resulting from the Parker acquisition. Total liabilities rose to $3.60 billion from $3.30 billion, mainly due to an increase in long-term debt. Total equity increased significantly to $649.7 million from $421.2 million, bolstered by the share issuance for the acquisition and net income for the quarter Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $1,198,818 | $999,537 | | **Property, plant and equipment, net** | $3,074,789 | $2,830,957 | | **Total assets** | **$5,049,684** | **$4,504,301** | | **Total current liabilities** | $667,645 | $571,917 | | **Long-term debt** | $2,685,169 | $2,505,217 | | **Total liabilities** | **$3,604,307** | **$3,297,963** | | **Total equity** | **$649,734** | **$421,247** | [Condensed Consolidated Statements of Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20%28Loss%29) For the first quarter of 2025, Nabors reported a net income of $57.2 million, a significant improvement from a net loss of $9.0 million in the same period of 2024. This was primarily due to a $113.0 million gain on bargain purchase from the Parker acquisition. Operating revenues remained stable at $736.2 million. Diluted earnings per share were $2.18, compared to a loss of $4.54 per share in Q1 2024 Q1 2025 vs Q1 2024 Income Statement (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Operating revenues** | $736,186 | $733,704 | | **Total revenues and other income** | $742,782 | $743,905 | | **Gain on bargain purchase** | $(112,999) | $— | | **Income (loss) before income taxes** | $72,186 | $7,042 | | **Net income (loss)** | $57,179 | $(9,002) | | **Net income (loss) attributable to Nabors** | $32,988 | $(34,333) | | **Diluted EPS** | $2.18 | $(4.54) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities was $87.7 million for Q1 2025, down from $107.2 million in Q1 2024. Investing activities used $74.9 million, an improvement from $106.6 million used in the prior year, mainly due to $84.4 million in cash acquired from the Parker acquisition, which offset higher capital expenditures. Financing activities used a minimal $2.0 million, compared to a significant use of $635.1 million in Q1 2024 which included a large debt reduction Q1 2025 vs Q1 2024 Cash Flows (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net cash provided by (used for) operating activities** | $87,735 | $107,239 | | **Net cash (used for) provided by investing activities** | $(74,920) | $(106,629) | | **Net cash (used for) provided by financing activities** | $(1,958) | $(635,107) | | **Net increase (decrease) in cash** | $10,437 | $(640,407) | | **Cash and cash equivalents, end of period** | $396,470 | $412,864 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail significant events and accounting policies, highlighted by the March 2025 acquisition of Parker Drilling for approximately $180.6 million, which resulted in a $113.0 million bargain purchase gain. The company also consolidated its SANAD joint venture and a special purpose acquisition company (SPAC). Debt structure was updated with a new 2024 Credit Agreement, and the Parker Term Loan was repaid. Segment performance shows revenue growth in International Drilling and Drilling Solutions, offset by a decline in U.S. Drilling - On March 11, 2025, Nabors completed the acquisition of Parker Drilling Company for consideration of **$0.6 million in cash** and **4.8 million common shares**, valued at approximately **$180.6 million**[33](index=33&type=chunk) - The Parker acquisition was accounted for as a business combination, resulting in a bargain purchase gain of **$113.0 million**. This gain arose because the fair value of net assets acquired (**$293.6 million**) exceeded the purchase price, primarily due to a decrease in Nabors' stock price between the signing and closing dates[34](index=34&type=chunk)[35](index=35&type=chunk) - The company recognized impairment charges of approximately **$26.5 million** related to the net carrying value of assets located in Russia during Q1 2025[20](index=20&type=chunk) - The SANAD joint venture with Saudi Aramco is consolidated as a variable interest entity (VIE). As of March 31, 2025, SANAD had total assets of **$1.28 billion**[41](index=41&type=chunk)[44](index=44&type=chunk) - Nabors co-sponsored a special purpose acquisition company (SPAC), NETC II, which is consolidated as a VIE. As of March 31, 2025, the SPAC's trust account balance was **$335.1 million**[102](index=102&type=chunk)[106](index=106&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reports stable Q1 2025 operating revenues of $736.2 million, nearly flat year-over-year. A net income of $33.0 million attributable to Nabors marks a significant improvement from a $34.3 million loss in Q1 2024, driven by a $113.0 million bargain purchase gain from the Parker acquisition, though partially offset by impairment and transaction costs. The outlook remains cautious due to market volatility, but notes supportive oil prices for international activity. Liquidity is strong with $404.1 million in cash and investments and availability under its credit facilities. The company remains in compliance with all debt covenants - The acquisition of Parker Drilling Company was completed on March 11, 2025, with its results included from that date. The acquisition is expected to generate synergies and benefits, though integration costs and risks exist[113](index=113&type=chunk)[120](index=120&type=chunk) - The market outlook is mixed. While supportive oil prices and international expansion are positive, U.S. activity has been reduced due to volatile natural gas prices and higher interest rates in 2023-2024. Customer consolidation in the U.S. may also impact rig demand[116](index=116&type=chunk)[117](index=117&type=chunk)[119](index=119&type=chunk) Q1 2025 vs Q1 2024 Financial Summary | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Operating Revenues** | $736.2M | $733.7M | | **Net Income (Loss) Attributable to Nabors** | $33.0M | $(34.3)M | | **Diluted EPS** | $2.18 | $(4.54) | - Primary sources of liquidity are cash from operations, cash on hand (**$404.1 million** including investments), and availability under the 2024 Credit Agreement. The company expects these sources to be sufficient for at least the next 12 months[136](index=136&type=chunk)[149](index=149&type=chunk) [Segment Results of Operations](index=47&type=section&id=Segment%20Results%20of%20Operations) In Q1 2025, International Drilling revenue grew 9% to $381.7 million with a 47% increase in adjusted operating income, driven by higher rig count and better pricing. Drilling Solutions revenue rose 23% to $93.2 million, boosted by the Parker acquisition. Conversely, U.S. Drilling revenue fell 15% to $230.7 million due to a 13% drop in working rigs. Rig Technologies revenue also declined 12% to $44.2 million, though margins remained stable Segment Performance (Q1 2025 vs Q1 2024, in thousands) | Segment | Operating Revenues (Q1'25) | Operating Revenues (Q1'24) | Change | Adjusted Operating Income (Q1'25) | Adjusted Operating Income (Q1'24) | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **U.S. Drilling** | $230,746 | $271,989 | (15)% | $31,599 | $50,529 | (37)% | | **International Drilling** | $381,718 | $349,359 | 9% | $32,958 | $22,476 | 47% | | **Drilling Solutions** | $93,179 | $75,574 | 23% | $32,913 | $26,893 | 22% | | **Rig Technologies** | $44,165 | $50,156 | (12)% | $4,335 | $4,209 | 3% | - U.S. Drilling performance declined due to a **13% decrease** in the average number of rigs working (**68.2 in Q1'25 vs 78.7 in Q1'24**), while pricing remained stable[128](index=128&type=chunk) - International Drilling saw growth from a **5% increase** in average rigs working (**85.0 in Q1'25 vs 81.0 in Q1'24**) and improved pricing[129](index=129&type=chunk) - Drilling Solutions revenue increase was primarily due to **$21.7 million** from acquired Parker operations, which offset declines in U.S. markets[130](index=130&type=chunk) [Liquidity and Capital Resources](index=49&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, Nabors had a solid liquidity position with $404.1 million in cash and short-term investments and $531.2 million in working capital. The company was in full compliance with its 2024 Credit Agreement covenants, with an interest coverage ratio of 4.20:1.00 (well above the 2.75:1.00 requirement). Cash from operations decreased to $87.7 million in Q1 2025 from $107.2 million in Q1 2024. The company utilized its credit facility to repay the $177.8 million Parker Term Loan acquired in the merger - As of March 31, 2025, the company had cash and short-term investments of **$404.1 million** and working capital of **$531.2 million**[136](index=136&type=chunk) - The company was in compliance with all covenants under its 2024 Credit Agreement as of March 31, 2025, and expects to remain so for the next twelve months[140](index=140&type=chunk) - On March 25, 2025, the outstanding balance of the **$177.8 million** Parker Term Loan was repaid using the company's credit agreement[53](index=53&type=chunk)[157](index=157&type=chunk) - The Accounts Receivable (A/R) Purchase Agreement term was extended to April 1, 2027, providing ongoing liquidity. As of March 31, 2025, **$121.0 million** had been sold under this facility[145](index=145&type=chunk)[146](index=146&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there were no material changes in its exposure to market risks during the first quarter of 2025 compared to what was disclosed in its 2024 Annual Report - There were no material changes in the company's exposure to market risk during the three months ended March 31, 2025, from those disclosed in the 2024 Annual Report[162](index=162&type=chunk) [Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2025. No material changes were made to the internal control over financial reporting during the quarter - Based on an evaluation as of the end of the reporting period, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective[164](index=164&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[165](index=165&type=chunk) [Part II - Other Information](index=57&type=section&id=PART%20II%20OTHER%20INFORMATION) [Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) The company refers to Note 9 of the financial statements for information on legal proceedings. The most significant matter detailed is a long-standing case in Algeria concerning foreign currency exchange controls, where a judgment of approximately $21.1 million was previously entered against Nabors. The Algerian Supreme Court has repeatedly overturned lower court rulings against the company, most recently on April 10, 2025, and the case has been sent to a different court for rehearing. The potential loss in excess of amounts accrued is up to $13.1 million - For details on legal proceedings, the report directs readers to Note 9 — Commitments and Contingencies — Litigation[167](index=167&type=chunk) - A key legal matter involves a judgment in Algeria for alleged violations of foreign currency exchange controls. On April 10, 2025, the Algerian Supreme Court again cancelled the judgment and sent the case back to a different court. The ultimate resolution could result in a loss of up to **$13.1 million** in excess of amounts accrued[76](index=76&type=chunk) [Risk Factors](index=57&type=section&id=Item%201A.%20Risk%20Factors) The company highlights that there have been no material changes to its risk factors from the 2024 Annual Report, other than new risks related to the Parker acquisition and trade policies. A key new risk is the concentration of voting power with former Parker shareholders who are bound by voting agreements to support board recommendations. Another emphasized risk is the potential adverse impact of changes in U.S. or other national trade policies, such as tariffs, which could increase supply chain costs - There have been no material changes to risk factors from the 2024 Annual Report, other than those listed in this section[168](index=168&type=chunk) - A new risk factor arises from the Parker acquisition, where certain former Parker shareholders entered into Voting & Lock-Up Agreements, requiring them to vote in favor of board-recommended proposals, which could limit other shareholders' ability to influence actions[169](index=169&type=chunk) - The company highlights the risk of significant changes in national trade policies, such as tariffs and import restrictions, which could increase the cost of raw materials and components, adversely affecting business and results of operations[171](index=171&type=chunk)[172](index=172&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2025, the company withheld a total of 45,000 common shares to satisfy tax withholding obligations related to share awards and the Parker acquisition. These were not part of a public repurchase program. As of March 31, 2025, $278.9 million remained authorized under the company's share repurchase program, which was reaffirmed in May 2025 Issuer Purchases of Equity Securities (Q1 2025) | Period | Total Shares Repurchased (in thousands) | Average Price Paid per Share | | :--- | :--- | :--- | | Jan 1 - Jan 31 | 10 | $57.17 | | Feb 1 - Feb 28 | 19 | $49.09 | | Mar 1 - Mar 31 | 16 | $38.00 | - The shares repurchased were withheld to satisfy tax withholding obligations for employees, directors, and in connection with the Parker acquisition, and were not part of a publicly announced repurchase program[174](index=174&type=chunk)[175](index=175&type=chunk) - As of March 31, 2025, **$278.9 million** remained available for share repurchases under the authorized program, which was reaffirmed by the Board in May 2025[176](index=176&type=chunk) [Other Information](index=61&type=section&id=Item%205.%20Other%20Information) The company disclosed that it awarded bonuses totaling $9.0 million for the successful completion of the Parker Wellbore acquisition. Of this amount, $6.3 million was awarded to named executive officers and $2.7 million to other employees. No directors or officers adopted or terminated any Rule 10b5-1 trading arrangements during the quarter - Bonuses were awarded for the successful completion of the Parker Wellbore acquisition, totaling **$6.3 million** for named executive officers and **$2.7 million** for other employees[181](index=181&type=chunk) - During the quarter ended March 31, 2025, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement[181](index=181&type=chunk)
Nabors Q1 Loss Wider Than Expected, Revenues Decline Y/Y
ZACKS· 2025-05-01 11:15
Core Viewpoint - Nabors Industries Ltd. reported a wider-than-expected adjusted loss in Q1 2025, primarily due to lower operating income from its U.S. Drilling segment, despite beating revenue estimates driven by international operations [1][2]. Financial Performance - The adjusted loss per share was $7.5, compared to the Zacks Consensus Estimate of a loss of $2.64 and a loss of $5.16 in the same quarter last year [1]. - Operating revenues were $736.2 million, exceeding the estimate of $718 million but down from $743.9 million year-over-year [1]. - Adjusted EBITDA decreased to $206.3 million from $221 million a year ago, missing the model estimate of $221.6 million [2]. Segmental Performance - U.S. Drilling revenues were $230.7 million, down 15.2% from $272 million year-ago, but above the estimate of $221.6 million. Operating profit was $31.6 million, down from $50.5 million [7]. - International Drilling revenues increased to $381.7 million from $349.4 million year-ago, beating the estimate of $357.1 million. Operating profit rose to $33 million from $22.5 million [8]. - Drilling Solutions segment revenues totaled $93.2 million, up 23.3% from $75.6 million year-ago, exceeding the estimate of $78.7 million. Operating income increased to $32.9 million from $26.9 million [9]. - Rig Technologies revenues were $44.2 million, down 11.9% from $50.2 million year-ago, missing the estimate of $47.6 million. Operating profit was $4.3 million, slightly up from $4.2 million [10]. Strategic Developments - Nabors finalized the acquisition of Parker Wellbore, enhancing its portfolio with complementary assets and expected to be accretive to free cash flow in 2025 [3]. - The SANAD joint venture deployed new rigs, expected to significantly boost adjusted EBITDA and support natural gas development [4]. - A strategic alliance with Corva AI was expanded to integrate AI-driven analytics into Nabors' RigCLOUD platform, enhancing operational performance [5]. Financial Position - Total costs and expenses decreased to $670.6 million from $736.9 million year-ago, below the prediction of $711.4 million [12]. - As of March 31, 2025, Nabors had $404.1 million in cash and short-term investments, with long-term debt of approximately $2.7 billion [12]. Guidance and Outlook - For Q2 2025, Nabors expects U.S. Drilling rig count to range from 63-64 rigs with a daily adjusted gross margin of about $14,100 [14]. - International rig count is anticipated to be 85-86 rigs, with a daily adjusted gross margin of approximately $17,700 [15]. - Capital expenditures for Q2 2025 are projected to be between $220 million and $230 million, with full-year expectations of $770-$780 million [17]. - Adjusted free cash flow for the full year is expected to be around $80 million, with SANAD consuming about $150 million [18]. - The SANAD Joint Venture's 2025 EBITDA is expected to exceed $300 million, with plans for an IPO under review [19].
Nabors(NBR) - 2025 Q1 - Earnings Call Transcript
2025-04-30 17:02
Nabors Industries (NBR) Q1 2025 Earnings Call April 30, 2025 12:00 PM ET Company Participants William Conroy - Vice President of Corporate Development & Investor RelationsAnthony Petrello - Chairman, President & CEOWilliam Restrepo - Chief Financial OfficerWaqar Syed - MD & Head of ResearchDavid Smith - DirectorKeith Mackey - Director - Global Equity Research, Oil & Gas ServicesJeff LeBlanc - Director - Equity ResearchJohn Daniel - Founder & CEO Conference Call Participants Arun Jayaram - Analyst Operator G ...
Nabors(NBR) - 2025 Q1 - Earnings Call Transcript
2025-04-30 16:00
Financial Data and Key Metrics Changes - Revenue from operations for Q1 2025 was $736 million, a slight increase of $6 million or 1% from the previous quarter [40] - Total adjusted EBITDA for the quarter was $206.3 million, down from $220.5 million in the fourth quarter, reflecting a decline of $14 million [45][46] - U.S. drilling revenue decreased by $11 million or 4.5% sequentially to $231 million [41] - Average daily rig margins in the Lower 48 came in just under $14,300, down $660 or 4% from the fourth quarter [47] Business Line Data and Key Metrics Changes - The international drilling segment generated revenue of $382 million, an increase of $10.3 million or 3% from the prior quarter, driven by activity increases in key markets [44] - Drilling Solutions revenue increased by $17.2 million or 22.6% to $93.2 million, benefiting from the addition of Parker operations [44][52] - Rig Technologies segment revenue declined by $12 million sequentially to $44.2 million, primarily due to lower capital equipment deliveries in the Middle East [45] Market Data and Key Metrics Changes - The Lower 48 market average quarterly rig count remained stable, with Nabors exiting Q1 with 62 rigs operating [41][39] - The international rig count increased slightly from 84.8 to 85 rigs during the quarter, aided by Parker's contribution [44] - The survey of 14 operators indicated a projected 4% reduction in rig count from the end of Q1 through the end of 2025 [29] Company Strategy and Development Direction - The company is focused on achieving $40 million in cost synergies from the Parker acquisition during 2025 [6][31] - There is a strategic emphasis on international markets, particularly in Saudi Arabia and Kuwait, where new rigs are expected to contribute positively to earnings [19][50] - The company aims to reduce debt and improve free cash flow, with a target of generating free cash in 2025 despite cash consumption [28][54] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment is challenging due to OPEC+ output adjustments and high U.S. shale production, but there are signs of recovery in natural gas activity [7][8] - The company expects a slight increase in rig count in Q2, driven by deployments in Saudi Arabia and Kuwait [39] - Management expressed confidence in the company's ability to navigate through short-term disruptions while positioning for future growth [59] Other Important Information - The company suspended operations in Russia due to U.S. sanctions and does not expect to resume activities there [11][38] - The company has made significant progress in capturing planned synergies from the Parker acquisition, with a focus on corporate cost reductions [57][80] Q&A Session Summary Question: Has the company started accruing any debt in the SANAD joint venture? - Management confirmed that there is no current plan to accrue debt in the SANAD joint venture [64] Question: Is Saudi Aramco finished with rig releases, or are more expected this quarter? - Management provided details on rig suspensions and additions, indicating a wait-and-see approach regarding future releases [65][66] Question: Which business segment is most affected by tariffs? - Management indicated that the impact of tariffs is more significant on spare parts and pumps rather than drill pipe, with mitigation strategies in place [72] Question: How does the company view the potential for an IPO of SANAD? - Management acknowledged that an IPO is a potential path for value realization, especially given the attractive valuations in the Middle East [77] Question: What is the expected corporate run rate for the second quarter with Parker's full contribution? - Management indicated that Parker's contribution should be in the mid-40s for the second quarter, with ongoing synergy capture [90]
Nabors(NBR) - 2025 Q1 - Earnings Call Presentation
2025-04-30 08:21
1Q 2025 Earnings Presentation NABORS INDUSTRIES Forward-Looking Statements We often discuss expectations regarding our future markets, demand for our products and services, and our performance in our annual, quarterly, and current reports, press releases, and other written and oral statements. Such statements, including statements in this document that relate to matters that are not historical facts, are "forward-looking statements" within the meaning of the safe harbor provisions of Section 27A of the U.S. ...
Nabors(NBR) - 2025 Q1 - Quarterly Results
2025-04-29 20:45
[Financial and Operational Highlights](index=1&type=section&id=Financial%20and%20Operational%20Highlights) This section details Nabors' Q1 2025 financial performance, strategic developments, segment results, cash flow, and future outlook [Q1 2025 Financial Performance](index=1&type=section&id=Q1%202025%20Financial%20Performance) Nabors reported Q1 2025 operating revenues of **$736 million**, achieving a **$33 million** net income, a significant turnaround from the prior quarter's loss, influenced by a one-time gain and Russian operation charges Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q4 2024 | Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $736 million | $730 million | +$6 million | | Net Income (Loss) Attributable to Nabors | $33 million | ($54 million) | +$87 million | | Earnings (Loss) per Diluted Share | $2.18 | ($6.67) | +$8.85 | | Adjusted EBITDA | $206 million | $221 million | -$15 million | - The first quarter results included a significant one-time, non-cash net gain of **$113.0 million**, or **$9.68** per diluted share, related to the Parker transaction[3](index=3&type=chunk) - The gain was partially offset by non-cash charges totaling **$28.6 million**, or **$2.45** per diluted share, for the wind-down of operations in Russia[3](index=3&type=chunk) [Key Operational and Strategic Developments](index=1&type=section&id=Key%20Operational%20and%20Strategic%20Developments) Q1 saw the successful acquisition of Parker Wellbore, expansion of the SANAD joint venture with new rig deployments, enhanced technology offerings through Corva AI, and the suspension of Russian operations due to sanctions - Completed the acquisition of Parker Wellbore in March, adding complementary businesses such as Quail Tools and a fleet of ten international and Alaskan drilling rigs. The transaction is expected to be immediately accretive to **2025 free cash flow**[6](index=6&type=chunk) - The SANAD joint venture deployed its **tenth newbuild rig** in Q1, with the **eleventh** starting in April and **three more** planned for the remainder of **2025**[6](index=6&type=chunk)[10](index=10&type=chunk) - Expanded the strategic alliance with Corva AI to integrate Corva's analytics into Nabors' RigCLOUD platform, aiming to enhance real-time data processing and predictive insights[6](index=6&type=chunk) - Suspended activity on its **three rigs** in Russia in March due to expanded sanctions, with no expectation of resuming activity in the near term[6](index=6&type=chunk) [Segment Performance Analysis](index=2&type=section&id=Segment%20Performance%20Analysis) International Drilling's adjusted EBITDA rose to **$115.5 million** with improved margins, while U.S. Drilling's fell to **$92.7 million** due to lower rig count; Drilling Solutions' adjusted EBITDA reached **$40.9 million** boosted by Parker, and Rig Technologies declined to **$5.6 million** Adjusted EBITDA by Segment (Q1 2025 vs. Q4 2024) | Segment | Q1 2025 Adjusted EBITDA | Q4 2024 Adjusted EBITDA | | :--- | :--- | :--- | | International Drilling | $115.5 million | $112.0 million | | U.S. Drilling | $92.7 million | $105.8 million | | Drilling Solutions | $40.9 million | $33.8 million (Q4 2024 from table) | | Rig Technologies | $5.6 million | $9.2 million (Q4 2024 from table) | - International Drilling's daily adjusted gross margin improved by over **$700** to **$17,421**, driven by newbuilds in Saudi Arabia and better performance in several geographies[9](index=9&type=chunk)[10](index=10&type=chunk) - U.S. Drilling's Lower 48 rig count averaged **61**, down from **66** in Q4, and daily margins decreased to **$14,276** from **$14,940** due to rig churn[11](index=11&type=chunk) - The Drilling Solutions (NDS) segment's results included a **$9.6 million** contribution from the Parker operations in Q1[12](index=12&type=chunk) [Adjusted Free Cash Flow](index=2&type=section&id=Adjusted%20Free%20Cash%20Flow) Nabors reported a **$71 million** adjusted free cash flow usage in Q1 2025, primarily due to seasonal payments, **$14 million** in Parker transaction costs, and collection shortfalls, with significant improvement anticipated for the remainder of the year - Consolidated adjusted free cash flow was a use of **$71 million** in Q1 2025[13](index=13&type=chunk) - Cash flow was negatively impacted by higher seasonal payments (bonuses, taxes), **$14 million** in severance and other costs related to the Parker transaction, and delayed collections[13](index=13&type=chunk)[16](index=16&type=chunk) - The Parker business is expected to add material free cash flow, with a forecast of **$130 million** in incremental adjusted EBITDA and **$40 million** in cost synergies for **2025** post-closing[15](index=15&type=chunk) [Outlook](index=3&type=section&id=Outlook) Nabors projects Q2 2025 Lower 48 rig count at **63-64** and international daily adjusted gross margin at **~$17,700**, with Drilling Solutions' adjusted EBITDA around **$75 million**; full-year **2025** targets include **~$80 million** adjusted free cash flow and **$770-$780 million** capital expenditures Q2 2025 Outlook | Segment/Metric | Q2 2025 Guidance | | :--- | :--- | | **U.S. Drilling** | | | Lower 48 Average Rig Count | 63 - 64 rigs | | Lower 48 Daily Adj. Gross Margin | ~$14,100 | | **International Drilling** | | | Average Rig Count | 85 - 86 rigs | | Daily Adj. Gross Margin | ~$17,700 | | **Drilling Solutions** | | | Adjusted EBITDA | ~$75 million | | **Rig Technologies** | | | Adjusted EBITDA | In line with Q1 | Full-Year 2025 Outlook | Metric | Full-Year 2025 Guidance | | :--- | :--- | | Capital Expenditures | $770 - $780 million | | Adjusted Free Cash Flow | ~$80 million (excl. tariff impact) | [Consolidated Financial Statements](index=7&type=section&id=Consolidated%20Financial%20Statements) This section presents Nabors' condensed consolidated statements of income, balance sheets, and segment reporting, along with non-GAAP financial measure reconciliations [Condensed Consolidated Statements of Income (Loss)](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20%28LOSS%29) Nabors reported Q1 2025 operating revenues of **$736.2 million**, resulting in a net income attributable to Nabors of **$33.0 million**, or **$2.18** per diluted share, a significant improvement from Q4 2024's net loss Key Income Statement Data (in thousands) | Line Item | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Operating revenues | $736,186 | $729,819 | | Income (loss) before income taxes | $72,186 | ($17,638) | | Net income (loss) attributable to Nabors | $32,988 | ($53,671) | | Diluted earnings (loss) per share | $2.18 | ($6.67) | [Condensed Consolidated Balance Sheets](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2025, Nabors' total assets increased to **$5.05 billion** from **$4.50 billion**, driven by the Parker acquisition, while total liabilities rose to **$3.60 billion**, and shareholders' equity improved to **$342.7 million** Key Balance Sheet Data (in thousands) | Line Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total current assets | $1,198,818 | $999,537 | | Total assets | $5,049,684 | $4,504,301 | | Total current liabilities | $667,645 | $571,917 | | Long-term debt | $2,685,169 | $2,505,217 | | Total liabilities | $3,604,307 | $3,297,963 | | Shareholders' equity | $342,660 | $134,996 | [Segment Reporting](index=9&type=section&id=SEGMENT%20REPORTING) In Q1 2025, International Drilling led with **$381.7 million** in revenue and **$115.5 million** in adjusted EBITDA, while U.S. Drilling followed, and the total average working rigs decreased to **153.2** due to a Lower 48 rig count decline Operating Revenues by Segment (in thousands) | Segment | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | U.S. Drilling | $230,746 | $241,637 | | International Drilling | $381,718 | $371,406 | | Drilling Solutions | $93,179 | $75,992 | | Rig Technologies | $44,165 | $56,166 | Adjusted EBITDA by Segment (in thousands) | Segment | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | U.S. Drilling | $92,711 | $105,757 | | International Drilling | $115,486 | $111,962 | | Drilling Solutions | $40,853 | $33,809 | | Rig Technologies | $5,563 | $9,208 | Average Rigs Working | Region | Q1 2025 | Q4 2024 | | :--- | :--- | :--- | | Lower 48 | 60.6 | 65.9 | | International Drilling | 85.0 | 84.8 | | **Total** | **153.2** | **157.5** | [Non-GAAP Reconciliations](index=12&type=section&id=Non-GAAP%20Reconciliations) This section provides detailed reconciliations of non-GAAP financial measures, including Adjusted EBITDA, Adjusted Free Cash Flow, and Net Debt, to their most comparable GAAP counterparts, ensuring transparency of alternative performance metrics - Adjusted EBITDA is derived from net income by excluding the effects of income taxes, investment income, interest expense, gain on bargain purchase, other net expenses, and depreciation & amortization[46](index=46&type=chunk)[47](index=47&type=chunk) - Adjusted free cash flow is calculated as net cash provided by operating activities minus capital expenditures (net of proceeds from asset sales). For Q1 2025, this was a use of **$(71,426) thousand**[52](index=52&type=chunk) - Net Debt as of March 31, 2025, was **$2.28 billion**, calculated by subtracting cash and short-term investments (**$404.1 million**) from long-term debt (**$2.69 billion**)[50](index=50&type=chunk)
Nabors Announces First Quarter 2025 Results
Prnewswire· 2025-04-29 20:15
HAMILTON, Bermuda, April 29, 2025 /PRNewswire/ -- Nabors Industries Ltd. ("Nabors" or the "Company") (NYSE: NBR) today reported first quarter 2025 operating revenues of $736 million, compared to operating revenues of $730 million in the fourth quarter of 2024. Net income attributable to Nabors shareholders for the quarter was $33 million, compared to a net loss of $54 million in the fourth quarter. This equates to earnings per diluted share of $2.18, compared to a loss per diluted share of $6.67 in the four ...