Nabors Q4 Loss Wider Than Expected, Sales Match Estimates

Core Insights - Nabors Industries Ltd. reported a fourth-quarter 2024 adjusted loss of $6.67 per share, significantly wider than the Zacks Consensus Estimate of a loss of $1.86, primarily due to lower operating income and increased costs [1][2] - The company's operating revenues were $730 million, slightly down from $738 million year-over-year, with adjusted EBITDA decreasing to $220.5 million from $230.1 million [2] Financial Performance - U.S. Drilling segment generated operating revenues of $241.6 million, down 9.1% from $265.8 million a year ago, with operating profit of $39 million compared to $51.5 million [7] - International Drilling's revenues increased to $371.4 million from $342.8 million year-over-year, with operating profit rising to $29.5 million from $18.6 million [8] - Drilling Solutions segment revenues totaled $76 million, down 1.3% from $77 million, with operating income of $28.9 million, lower than the previous year's $30.1 million [9] - Rig Technologies revenues were $56.2 million, down 5.1% from $59.3 million, but operating profit increased to $8.4 million from $5.8 million [10] Cost Structure - Total costs and expenses rose to $756.3 million from $714.7 million year-over-year, exceeding predictions [11] Strategic Developments - Nabors secured contracts for three rigs in Argentina and an additional contract for an idle rig in Colombia, enhancing asset utilization [4] - The SANAD project deployed its ninth new-build rig and plans to deploy two more in early 2025, aligning with Saudi Aramco's expansion [5] - Canrig, part of Nabors' Rig Technologies, was awarded a comprehensive rig upgrade package, indicating ongoing technological advancements [6] Future Guidance - For Q1 2025, Nabors anticipates an average rig count of approximately 61 in the U.S. drilling segment and 85 to 86 in the International Drilling segment [13] - Expected adjusted EBITDA for the Drilling Solutions segment is around $36 million, with capital expenditures projected between $195 million and $205 million [14] - Full-year capital expenditures are expected to total approximately $710 million to $720 million, with $360 million earmarked for SANAD new builds [15]