Oil States International(OIS) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company generated revenues of $165 million and adjusted consolidated EBITDA of$19 million in Q4 2024 [11] - Adjusted net income totaled $5.5 million or$0.09 per share, excluding a gain of $15.3 million from the sale of an idled facility and$3.1 million in restructuring charges [12] - Cash flows from operations amounted to $18 million, with$14 million invested in CapEx [9][14] Business Line Data and Key Metrics Changes - Offshore manufactured product segment revenues grew 5% sequentially to $107 million, with adjusted segment EBITDA of$25 million, up 6% sequentially [12] - Completion and production services segment generated revenues of $30 million and adjusted segment EBITDA of$3.5 million, with a decline of $1.6 million or 5$27 million with breakeven adjusted segment EBITDA [13] Market Data and Key Metrics Changes - International and offshore revenues accounted for 72% of consolidated revenues, while US land-driven revenues represented 28% [6] - The company expects 2025 full-year revenues to range between $700 million and$735 million, with EBITDA between $88 million and$93 million [19] Company Strategy and Development Direction - The company is focused on growing operations and strategically investing in profitable business areas, supported by advanced technologies [9] - Strategic priorities include optimizing global operations, capitalizing on offshore and international markets, and focusing on core competencies and technology differentiators [21] - The company aims to improve profitability in completion and production services and downhole technology segments through restructuring initiatives [17] Management's Comments on Operating Environment and Future Outlook - Management noted strong long-term prospects for oil, natural gas, and LNG, driving capital investments in offshore and international projects [15] - Domestic market conditions are expected to remain flat in 2025, but profitability is anticipated to improve due to restructuring efforts [17] - The company is optimistic about revenue growth from new technology introductions and international contract opportunities [18] Other Important Information - The company repurchased $9 million of common stock during the quarter [9] - Cash flows from operations are expected to remain strong in 2025, with planned CapEx of approximately$25 million [19] Q&A Session Summary Question: Focus on buybacks over debt reduction - Management feels comfortable with current debt levels and prioritizes shareholder returns through buybacks [25][26] Question: Revenue opportunity from FPSO growth - Management indicated potential revenue growth in offshore manufactured products, with key connectors valued between $15 million to$25 million per order [31][32] Question: Margin profile in completion and production services for 2025 - Management aims to improve margins to the 19% to 20% range in 2025, following a mid-teens range in 2024 [51] Question: Backlog and margin profile commentary - Management noted that their offshore manufactured product business has maintained a solid growth and margin profile over the years [57] Question: International and offshore market outlook - Management highlighted differentiated technology opportunities in Brazil and Southeast Asia, with active bidding and quoting activity [66][67] Question: US land activity trajectory - Management observed a lift in activity as early as January, focusing on selective product offerings and capital allocation [72][74]