Financial Performance - For the six months ended June 30, 2025, Innovex's revenue was approximately $222.5 million, with net income at about $13.3 million, representing 6% of revenue [113]. - Revenues for the three months ended June 30, 2025, were $224.2 million, a 72% increase from $130.3 million in the same period of 2024 [137]. - Net income for the three months ended June 30, 2025, was $15.3 million, a 61% increase from $9.5 million in the same period of 2024 [150]. - Net income for the six months ended June 30, 2025, was $30.1 million, an increase of $4.1 million from the prior year [162]. - Free Cash Flow for the six months ended June 30, 2025, was $75.9 million, an increase of 144% from $31.1 million in the prior year [186]. - Adjusted EBITDA for the six months ended June 30, 2025, was $92.6 million, up $30.6 million or 49% from $62.0 million in the same period of 2024 [182]. - Adjusted EBITDA for the six months ended June 30, 2025, was approximately 20% of revenue, down from 24% in the same period of 2024 [113]. - Adjusted EBITDA Margin decreased to 20% for the six months ended June 30, 2025, from 24% in the same period of 2024 [180]. - ROCE for the twelve months ended June 30, 2025, was 13%, down from 17% in the previous year [184]. Market and Revenue Breakdown - The U.S. and Canadian onshore market accounted for approximately 52% of total revenue, while international and offshore markets contributed 48% [109]. - The company’s NAM market revenue for the six months ended June 30, 2025, was $240.5 million, an increase of $80.4 million from the same period in 2024 [151]. - Global upstream energy spending is expected to remain flat through 2027, with approximately 32,000 wells projected to be drilled annually [123]. Costs and Expenses - Cost of revenues for the three months ended June 30, 2025, was $152.5 million, an 81% increase from $84.3 million in the same period of 2024 [137]. - Selling, general and administrative expenses for the three months ended June 30, 2025, were $28.8 million, a 55% increase from $18.6 million in the same period of 2024 [141]. - Acquisition and integration costs for the three months ended June 30, 2025, were $5.1 million, a 16% increase from $4.4 million in the same period of 2024 [145]. - Total depreciation and amortization expense for the six months ended June 30, 2025, was $29.9 million, an increase of 163% from $11.4 million in the same period of 2024 [155]. - Income tax expense for the three months ended June 30, 2025, was $6.9 million, a 59% increase from $4.3 million in the same period of 2024 [149]. - Income tax expense for the six months ended June 30, 2025, was $13.5 million, an increase of $4.1 million from the prior year, driven by changes in income mix and non-deductible expenses [161]. - Interest expense decreased by 6% to $1.3 million for the six months ended June 30, 2025, compared to $1.3 million in 2024 [180]. - Long-lived asset impairment expense for the six months ended June 30, 2025, was $3.4 million, a decrease of $0.1 million from the prior year [156]. Acquisitions and Mergers - The company completed the acquisition of Citadel Casing Solutions, LLC for $69.7 million in cash, enhancing its portfolio of downhole technologies [118]. - The company acquired the remaining 80% equity interest in DWS on November 29, 2024, and has fully consolidated DWS's earnings thereafter [134]. - The company has a disciplined acquisition strategy, having identified numerous high-quality acquisition targets to drive growth [111]. - Innovex's recent merger with Legacy Innovex was completed on September 6, 2024, resulting in a new corporate structure and name change [115]. - Acquisition and integration costs for the six months ended June 30, 2025, totaled $9.4 million, an 81% increase from $5.2 million in 2024 [181]. Cash Flow and Financial Flexibility - Net cash provided by operating activities for the six months ended June 30, 2025, was $90.3 million, an increase of 155% from the prior year [168]. - Net cash used in investing activities for the six months ended June 30, 2025, was $86.3 million, an increase of 2503% from the prior year, primarily due to acquisitions [168]. - Total indebtedness was $40.7 million as of June 30, 2025, with cash and restricted cash of $68.8 million and availability under the Revolver of $110.4 million [163]. - The effective interest rate on the Revolver for the six months ended June 30, 2025, was approximately 6.94%, down from 9.69% in the prior year [165]. - The company has established a $200 million senior secured revolving credit facility, maturing on February 27, 2030, to enhance financial flexibility [120]. - The Company had $22.2 million of minimum non-cancelable lease obligations for the twelve months following June 30, 2025 [165]. Product and Value Proposition - Innovex's products are designed to save customers time and reduce costs, creating a "Big Impact, Small Ticket" value proposition [108].
Innovex International, Inc.(INVX) - 2025 Q2 - Quarterly Report