Nabors Announces Fourth Quarter 2024 Results

Core Insights - Nabors Industries reported fourth quarter 2024 operating revenues of $730 million, slightly down from$732 million in the previous quarter, with a net loss of $54 million compared to a loss of$56 million in Q3 2024 [1] - The company anticipates stable market activity in early 2025 and is taking steps to improve efficiency and align its cost structure [4][5] - The acquisition of Parker Wellbore is expected to enhance strategic objectives and create value for stakeholders [3] Financial Performance - Fourth quarter adjusted EBITDA was $221 million, down from$222 million in the previous quarter [1] - The U.S. Drilling segment reported adjusted EBITDA of $105.8 million, a decrease from$108.7 million in Q3 2024, with a Lower 48 average rig count of 66 [8] - International Drilling adjusted EBITDA totaled $112 million, down from$116 million in the previous quarter, with an average rig count of 85 [7] Capital Expenditures and Cash Flow - Consolidated adjusted free cash flow for the fourth quarter was a use of $53 million, influenced by a$50 million collections shortfall in Mexico and higher capital expenditures of $241 million [10][11] - The company forecasts capital spending of$710 to $720 million for the full year 2025, with approximately$360 million allocated to SANAD newbuild construction [13][25] Strategic Initiatives - The SANAD joint venture with Saudi Aramco is expected to double its contribution to adjusted EBITDA in 2025, with plans for significant rig deployments in Saudi Arabia, Argentina, Colombia, and Kuwait [6][7] - The company is pursuing growth opportunities in international markets, particularly in Saudi Arabia and Argentina, despite the pressure on capital expenditures [5] Outlook - For Q1 2025, the company projects adjusted EBITDA of approximately $33 million for U.S. Drilling and$5 million for Rig Technologies, with an overall expectation of breakeven adjusted free cash flow for the year [16][17][18] - The anticipated impact of the Parker Wellbore acquisition is not included in the current forecasts, but it is expected to provide incremental free cash flow [15][16]