e Laboratories (US:CLB)2025-04-25 22:36Financial Performance - Total revenue for Q1 2025 was $123.585 million, a decrease of 5% from $129.637 million in Q1 2024[94]. - Service revenue accounted for $95.091 million (77% of total revenue), while product sales were $28.494 million (23% of total revenue) in Q1 2025[94]. - Operating income fell to $4.417 million, down 48% from $8.571 million in the same quarter last year[94]. - Net income attributable to Core Laboratories Inc. was a loss of $154, compared to a profit of $3.220 million in Q1 2024, representing a significant decline[94]. - For the three months ended March 31, 2025, total revenue was $123.6 million, a decrease of 4% from $129.2 million in the previous quarter[96]. - Service revenue was $95.1 million, down 1% year-over-year and sequentially, primarily due to lower international market activity impacted by geopolitical conflicts[98]. - Product sales revenue decreased to $28.5 million, a 14% decline year-over-year and 13% sequentially, driven by reduced sales in both U.S. and international markets[100]. - Operating income fell to $4.4 million, a significant decrease of 69% from $14.2 million in the previous quarter[96]. - General and administrative expenses increased to $13.6 million, up 50% year-over-year, primarily due to higher consulting and license fees[107]. - The effective tax rate for the three months ended March 31, 2025, was 96.2%, significantly higher than 32.2% in the same period of 2024[115]. - The company reported a net income of $69, a drastic decline of 99% from $7.5 million in the previous quarter[96]. Liquidity and Debt Management - The current ratio decreased to 2.21:1 from 2.68:1 year-over-year, indicating a decline in liquidity[94]. - The current ratio decreased to 2.21:1 from 2.32:1 in the previous quarter, indicating a slight decline in liquidity[96]. - The debt to EBITDA ratio improved to 1.37:1 from 1.99:1, reflecting better leverage management[94][95]. - The debt to EBITDA ratio remained stable at 1.37:1, reflecting consistent leverage levels[97]. - As of March 31, 2025, the company had a total long-term debt of $126 million, with a leverage ratio of 1.31 and an interest coverage ratio of 6.86, indicating compliance with financial covenants[137]. - The company has an available borrowing capacity of approximately $108 million under its credit facility as of March 31, 2025[135]. Cash Flow and Dividends - Cash flows from operating activities improved to $6.7 million in Q1 2025, a 20% increase from $5.5 million in Q1 2024, primarily due to better credit terms on accounts payable[128]. - Free cash flow for Q1 2025 was $3.9 million, a 56% increase from $2.5 million in the same period in 2024, driven by improved operating cash flows[133]. - Cash flows used in financing activities for Q1 2025 were $4.5 million, including a $2.0 million net reduction in long-term debt and $2.0 million for stock repurchase[130]. - The company maintains a quarterly dividend of $0.01 per share[127]. Market Outlook - Global demand for crude oil and natural gas is expected to continue growing in 2025 and beyond, despite recent price volatility due to geopolitical tensions and trade negotiations[87][88]. - OPEC+ plans to gradually increase production by 2.2 million barrels per day starting May 2025, which may impact crude oil prices and inventory levels[87][88]. - Major clients are prioritizing capital management and free cash flow over production growth, which may influence future project investments[92]. Segment Performance - Revenue from the Reservoir Description segment was $80.9 million, down 4% year-over-year, while the Production Enhancement segment generated $42.7 million, a 6% decrease[116]. - Revenue from the Reservoir Description segment was $80.9 million for Q1 2025, a decrease of 4% year-over-year and 7% sequentially due to disruptions in crude oil trading and maritime transportation[118]. - Operating income for the Reservoir Description segment was $2.3 million in Q1 2025, down $4.6 million year-over-year and $14.3 million sequentially, with operating margins at 3% compared to 8% year-over-year[119]. - Revenue from the Production Enhancement segment was $42.7 million for Q1 2025, a decrease of 6% year-over-year but an increase of 1% sequentially, driven by lower product sales in the U.S. land market[122]. - Operating income for the Production Enhancement segment was $1.5 million in Q1 2025, slightly down year-over-year but up $4.1 million sequentially, with operating margins at 4% compared to 3% year-over-year[123].