Weatherford International(US:WFRD)2025-04-23 20:30PART I – FINANCIAL INFORMATION Financial Statements The unaudited statements for Q1 2025 show decreased revenue and net income, with key details on assets, liabilities, cash flow, and segment performance Condensed Consolidated Statements of Operations (Unaudited) | (In millions, except per share) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total Revenue | $1,193 | $1,358 | | Operating Income | $142 | $233 | | Net Income Attributable to Weatherford | $76 | $112 | | Diluted Income per Share | $1.03 | $1.50 | Condensed Consolidated Balance Sheets (Unaudited) | (In millions) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and Cash Equivalents | $873 | $916 | | Total Current Assets | $3,264 | $3,402 | | Total Assets | $5,054 | $5,159 | | Total Current Liabilities | $1,567 | $1,696 | | Long-term Debt | $1,583 | $1,617 | | Total Liabilities | $3,694 | $3,876 | | Total Shareholders' Equity | $1,360 | $1,283 | Condensed Consolidated Statements of Cash Flows (Unaudited) | (In millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $142 | $131 | | Net Cash Used in Investing Activities | $(79) | $(54) | | Net Cash Used in Financing Activities | $(133) | $(187) | - In Q1 2025, the company repurchased $34 million in principal of its 2030 Senior Notes40 - During Q1 2025, the company repurchased 0.8 million ordinary shares for $53 million and paid $18 million in dividends4849 - Subsequent to the quarter end, the company sold its Pressure Pumping business in Argentina for approximately $104 million in cash and declared a $0.25 per share dividend60 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses a 12% revenue decline due to reduced activity, segment performance, capital returns, and customer concentration risk in Mexico Business and Industry Trends The company's performance is tied to energy sector trends, with lower Q1 2025 commodity prices and rig counts impacting activity levels Average Commodity Prices & Rig Counts | Indicator | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Oil price - WTI ($/bbl) | $71.84 | $77.56 | | Oil price - Brent ($/bbl) | $75.81 | $83.00 | | Worldwide Rig Count (Avg) | 1,706 | 1,796 | - Revenues from Russia were approximately 6% of total revenues for Q1 2025, and the company is actively evaluating strategic options for this business7475 Consolidated Results of Operations Total revenue decreased 12% year-over-year to $1.2 billion, causing a 39% drop in operating income despite reduced operating expenses Consolidated Operating Summary (Q1 2025 vs Q1 2024) | (In millions) | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | $1,193 | $1,358 | -12% | | Operating Income | $142 | $233 | -39% | | Cost of Products and Services | $819 | $884 | -7% | | SG&A and R&D | $190 | $236 | -20% | | Restructuring Charges | $29 | $3 | +867% | - The year-over-year revenue decrease was primarily driven by a decline in activity, with the Latin America region accounting for 78% of the drop76 Results of Operations by Segment All three operating segments experienced revenue declines, with varied impacts on adjusted EBITDA margins due to activity mix and cost factors DRE Segment Results (Q1 2025 vs Q1 2024) | ($ in Millions) | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $350 | $422 | -17% | | Segment Adjusted EBITDA | $74 | $130 | -43% | | Segment Adj. EBITDA Margin | 21.1% | 30.8% | -966 bps | WCC Segment Results (Q1 2025 vs Q1 2024) | ($ in Millions) | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $441 | $458 | -4% | | Segment Adjusted EBITDA | $128 | $120 | +7% | | Segment Adj. EBITDA Margin | 29.0% | 26.2% | +282 bps | PRI Segment Results (Q1 2025 vs Q1 2024) | ($ in Millions) | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | $334 | $348 | -4% | | Segment Adjusted EBITDA | $62 | $73 | -15% | | Segment Adj. EBITDA Margin | 18.6% | 21.0% | -241 bps | Liquidity and Capital Resources The company maintained solid liquidity with $142 million in operating cash flow while managing debt, share repurchases, and customer credit risk Cash Flow Summary (Q1 2025 vs Q1 2024) | (In millions) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $142 | $131 | | Net Cash Used in Investing Activities | $(79) | $(54) | | Net Cash Used in Financing Activities | $(133) | $(187) | - Primary uses of cash in financing activities for Q1 2025 were $53 million for share repurchases, $39 million for debt repayments, and $18 million for dividends113 - As of March 31, 2025, the company's largest customer in Mexico accounted for 25% of total net accounts receivables and has a history of late payments120 Quantitative and Qualitative Disclosures About Market Risk The company's market risk exposure has not materially changed from the prior fiscal year-end - The company's exposure to market risk has not changed materially since December 31, 2024136 Controls and Procedures Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of March 31, 2025139 - No material change in internal control over financial reporting occurred during Q1 2025140 PART II – OTHER INFORMATION Legal Proceedings Information regarding the company's disputes and litigation is detailed in the financial statement notes - For details regarding ongoing disputes and litigation, refer to "Note 8 – Disputes, Litigation and Legal Contingencies" in the financial statements142 Risk Factors There have been no material changes to the company's risk factors since the last annual report - As of March 31, 2025, there have been no material changes in the company's risk factors from the 2024 Form 10-K143 Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased $53.3 million of its ordinary shares in Q1 2025, with $348 million remaining authorized for future buybacks - There were no unregistered sales of equity securities in Q1 2025144 Issuer Repurchases of Equity Securities (Q1 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | January 1 - 31 | 250,328 | $70.79 | | February 1 - 28 | 249,603 | $66.99 | | March 1 - 31 | 347,031 | $54.52 | | Total | 846,962 | $63.00 | Defaults Upon Senior Securities No defaults upon senior securities occurred during the reporting period - None147 Mine Safety Disclosures This disclosure requirement is not applicable to the company's operations - Not applicable148 Other Information No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No director or executive officer adopted or terminated a Rule 10b5-1 trading arrangement during Q1 2025149 Exhibits The filing includes required CEO/CFO certifications and interactive data files as exhibits - Exhibits filed include CEO and CFO certifications under Sections 302 and 906 of the Sarbanes-Oxley Act, and XBRL interactive data files151 Signatures The report is duly authorized and signed by the company's executive officers on behalf of the registrant - The report was duly signed and authorized by the company's Chief Financial Officer and Chief Accounting Officer on April 23, 2025154155