Financial Data and Key Metrics Changes - The company generated adjusted EPS of $1.99, a 47% improvement from the prior year [5] - GAAP earnings were $2.05 per diluted share, with adjusted earnings including one-time benefits of $28 million or $0.20 per diluted share [12] - Adjusted revenue in the title segment was $1.9 billion, up 14% compared to the same quarter of 2024 [13] - Personnel costs increased by 11% to $581 million, primarily due to incentive compensation [16] - The effective tax rate was 25.7%, higher than the normalized rate of 24% [20] Business Line Data and Key Metrics Changes - Commercial revenue grew by 35% to $339 million, driven by higher average revenue per order and transaction volumes [13][14] - Closed orders increased by 10% in the commercial segment, while average revenue per order rose by 22% [14] - Residential purchase revenue decreased by 4%, with closed orders down by 7% [14] - Refinance revenue increased by 47%, driven by a 44% increase in closed orders [14] Market Data and Key Metrics Changes - Existing home sales are approximately 4 million units, below the normalized level of 5.5 million units [6] - Open purchase orders were down 7% in the fourth quarter, indicating continued weakness in purchase revenue [10] - Refinance open orders were up 72% in January, suggesting a positive trend for the first quarter [10] Company Strategy and Development Direction - The company aims to be the best title and escrow company in the industry, focusing on modern AI-powered products to improve customer experience and operational efficiency [11] - The launch of Endpoint and Sequoia AI is expected to provide a competitive advantage and improve margins over time [8][36] - The company plans to roll out Endpoint nationally over the next two years and expand Sequoia AI capabilities [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting growth across major revenue drivers despite uncertainty [9][10] - The company anticipates a record revenue year in the commercial segment, with a strong pipeline [9] - Management noted that the rate lock-in effect is expected to fade, allowing for improved affordability in the housing market [10] Other Important Information - The company has gained 90 basis points of organic market share over the last 12 months [10] - The bank subsidiary has quickly grown 1031 exchange deposits from $94 million to over $300 million [9] - The company is focused on investing in technology and maintaining a strong balance sheet while returning capital to shareholders [60] Q&A Session Summary Question: Can you help us think about the potential improvement over 2025 in commercial? - Management is optimistic about 2026, noting broad-based strength and a strong pipeline, but specific growth percentages are uncertain [24] Question: What is the contribution from data centers to commercial premiums? - Data centers accounted for roughly 10% of premiums, with significant growth expected [25][26] Question: How should we think about margin impacts from Sequoia and Endpoint? - The margin drag is expected to gradually alleviate as investments in modern platforms increase [36] Question: What are the primary drivers of the adjusted pretax margin expansion? - The higher margin is driven by commercial tailwinds and effective expense management [50] Question: What are the capital allocation priorities heading into 2026? - The first priority is investing in core business technology, followed by acquisitions and returning capital to shareholders [56][58] Question: What is the expected impact of the Texas title insurance rate reduction? - The rate change is expected to lower total revenue and net operating revenue in the title segment by about 50 basis points [86] Question: What is the guidance for investment income for Q1 or the full year? - Investment income for 2026 is expected to be roughly flat compared to 2025 [93]

Financial Data and Key Metrics Changes - For the full year 2025, revenue was $3.2 billion, reflecting an 8.7% year-over-year growth, primarily driven by the acquisition of Parker and strong international expansion [20] - Adjusted EBITDA for the full year was $913 million, an increase of $31 million compared to the prior year [20] - In the fourth quarter, consolidated revenue was $798 million, a decrease of $21 million or 2.5% sequentially, impacted by the divestiture of Quail Tools [20][21] - Adjusted EBITDA for the fourth quarter totaled $222 million, representing an EBITDA margin of 27.8%, down 110 basis points sequentially [21] Business Line Data and Key Metrics Changes - International drilling revenue was $424 million, a growth of $17 million or 4.1% sequentially, with EBITDA for the segment increasing to $131 million [22] - U.S. drilling revenue for the fourth quarter was $241 million, reflecting a 3.7% sequential decline, while EBITDA totaled $93 million, a decrease of 1% [24][25] - The Drilling Solutions segment generated revenue of $108 million in the fourth quarter, with EBITDA of $41 million, resulting in an EBITDA margin of 38.3% [28] Market Data and Key Metrics Changes - The average daily rig margin in international drilling was $17,630, a decrease of $301 sequentially, primarily due to activity disruptions in Colombia and maintenance days in Saudi Arabia [23] - In the Lower 48, the gas-directed industry rig count increased by over 20% in 2025, with Nabors' gas rig count increasing by 50% [10] - The Baker Hughes weekly Lower 48 land rig count decreased by three rigs from the end of September through December, indicating stability in the market [13] Company Strategy and Development Direction - The company aims to focus on performance excellence in the Lower 48 rig market and expand in the international drilling market, leveraging multi-year contracts and innovative technology [6][7] - The integration of Parker Wellbore is progressing well, with expectations to generate at least $70 million in Adjusted EBITDA in 2026 from retained Parker businesses [36] - The company is committed to reducing debt, having reduced net debt by over $554 million, the lowest level since 2005, which is expected to enhance free cash flow [18][44] Management's Comments on Operating Environment and Future Outlook - The management expressed caution regarding the second half of 2026 due to external market uncertainties, including oil supply exceeding demand and geopolitical tensions [8][81] - The outlook for 2026 envisions EBITDA performance matching last year's, with expected increases in several operations offsetting the impact of the Quail divestiture [18] - The company remains optimistic about the long-term picture for gas and is well-positioned to capitalize on market opportunities [51] Other Important Information - The company generated adjusted free cash flow of $132 million in the fourth quarter, significantly exceeding the revised guidance of approximately $80 million [39] - Capital expenditures for the fourth quarter were $158 million, lower than previous guidance, with expectations for 2026 capital expenditures to be in the range of $730 million to $760 million [37][38] Q&A Session Summary Question: Lower 48 outlook and increasing rig count drivers - The company is currently running 66 rigs, with a shift towards public operators and an increase in gas rig count to 20% [49] - The trend towards longer laterals is significant, with a notable increase in three- and four-mile laterals, positioning the company well in the market [50] Question: Updates on Saudi Arabia operations - The company is confident in the timelines for reactivating suspended rigs and deploying new builds, with a positive outlook for the labor market [60][62] Question: Activity in Mexico and additional rigs - The company is focused on making existing rigs profitable and is optimistic about the market's improvement and payment mechanisms [66] Question: Capital expenditures and SANAD program - The SANAD new build program is expected to have a capital expenditure of around $360 million to $380 million for 2026, with adjustments made for previous delays [67][68]

Financial Data and Key Metrics Changes - Underlying net income reached CAD 1.1 billion, contributing to underlying earnings per share growth of 17% year-over-year and an underlying return on equity of 19.1% [5][15] - Total company reported net income was CAD 722 million, 34% lower than underlying net income, primarily due to market-related impacts [17] - The LICAT ratio ended at 157%, demonstrating a strong capital position, up 3 percentage points from the previous quarter [5][18] Business Line Data and Key Metrics Changes - SLC Management achieved CAD 242 million in underlying net income, exceeding its investor day target of CAD 235 million [6][21] - In Canada, gross sales were up 46% year-over-year, driven by strong results in Group Retirement Services and individual mutual funds [7][24] - Group Health and Protection underlying earnings increased by 16% year-over-year, while individual protection underlying net income rose by 17% [16][25] Market Data and Key Metrics Changes - Asia saw a 50% year-over-year growth in protection sales, with standout performances in Hong Kong and Indonesia [8][29] - U.S. Medical Stop-Loss business reported robust sales growth of 58% [9][25] - MFS experienced net outflows of approximately CAD 18.2 billion, consistent with industry trends, but had positive net flows in fixed income and ETF products [19][20] Company Strategy and Development Direction - The company is focused on a balanced and diversified growth strategy, with a commitment to digital transformation and enhancing client experiences [10][11] - The introduction of a management equity plan for SLC aims to motivate and retain talent in the alternative asset management space [6][21] - The company plans to complete the buyouts of BGO and Crescent Capital in the first half of 2026, further strengthening its alternative asset management platform [22][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business mix and disciplined execution of long-term strategies, despite a complex operating environment [14][30] - The company anticipates continued strong earnings growth aligned with medium-term objectives, with underlying EPS growth at 12% and underlying ROE at 18.2% [11][29] - Management highlighted the importance of maintaining a strong culture and commitment to client impact as key differentiators [11][13] Other Important Information - The company achieved a full-year underlying earnings growth of 9% and concluded 2025 with over CAD 1.6 trillion in overall assets under management [12][13] - The company launched a fully digital group retirement solution, Sun Life Essentials, to capture market share in the small to medium business segment [10] Q&A Session Summary Question: Regarding stop-loss experience and future improvements - Management noted a modest improvement in the loss ratio and expressed confidence heading into 2026 [33][36] Question: On pricing increases in stop-loss - Management confirmed a 17% average price increase on renewal business, which aligns with target margins [40][42] Question: Capital deployment strategy and buybacks - Management emphasized a disciplined approach to capital deployment, prioritizing organic growth and completing private asset affiliate purchases before resuming share buybacks [49][50] Question: Strategy for growth in the dental market - Management highlighted a strong distribution footprint and growth in the commercial dental segment, expecting continued expansion [60][61] Question: Future growth expectations in Asia - Management anticipates moderation in growth rates but remains optimistic about performance in Hong Kong and other markets like Indonesia [69]

Financial Data and Key Metrics Changes - The company generated adjusted EPS of $1.99, a 47% improvement from the prior year [5] - GAAP earnings were $2.05 per diluted share, with adjusted earnings including one-time benefits of $28 million or $0.20 per diluted share [12] - Adjusted revenue in the title segment was $1.9 billion, up 14% compared to the same quarter of 2024 [13] - Personnel costs increased by 11% to $581 million, primarily due to incentive compensation [16] Business Line Data and Key Metrics Changes - Commercial revenue grew by 35% to $339 million, driven by higher average revenue per order and transaction volumes [13][14] - Closed orders increased by 10% year-over-year, while average revenue per order rose by 22% to a record $18,600 per closing [14] - Residential purchase revenue decreased by 4%, reflecting a 7% decline in closed orders [14] - Refinance revenue increased by 47%, driven by a 44% increase in closed orders [14] Market Data and Key Metrics Changes - Existing home sales are running at approximately 4 million units, below the normalized level of 5.5 million units [6] - Open purchase orders were down 7% in the fourth quarter, indicating continued weakness in purchase revenue [10] - Refinance open orders were up 72% in January, suggesting a positive trend for the first quarter [10] Company Strategy and Development Direction - The company aims to be the best title and escrow company in the industry, focusing on modern AI-powered products to improve customer experience and operational efficiency [11] - The launch of the Endpoint platform and the Sequoia title production engine are key strategic initiatives, with plans for national rollout over the next two years [8][36] - The company is also focused on enhancing its competitive advantage through data assets and adjacent businesses [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting growth across major revenue drivers: commercial, purchase, and refinance [9] - The company anticipates a record revenue year for commercial, with a strong pipeline despite uncertainty [9] - Management noted that the rate lock-in effect is expected to fade, allowing for improved affordability in many markets [10] Other Important Information - The company ended the year with $94 million in 1031 exchange deposits, which have grown to over $300 million [9] - The effective tax rate for the quarter was 25.7%, higher than the normalized rate of 24% due to higher income from non-insurance businesses [20] Q&A Session Summary Question: Potential improvement in commercial revenue for 2026 - Management is optimistic about commercial revenue growth in 2026, citing strong momentum and a robust pipeline, but specific growth percentages are uncertain [24] Question: Contribution from data centers to commercial premiums - Data centers accounted for roughly 10% of commercial premiums, with significant growth expected [25][26] Question: Impact of Sequoia and Endpoint on margins - Management indicated that margin drag from legacy platforms will gradually alleviate as investments in modern platforms increase [34] Question: Drivers of adjusted pretax margin expansion - The higher margin is attributed to commercial tailwinds, effective expense management, and a favorable revenue mix [50] Question: Texas title insurance rate reduction impact - The rate change is expected to lower total revenue and net operating revenue in the title segment by about 50 basis points [86]

Financial Data and Key Metrics Changes - The company reported adjusted earnings per share (EPS) of $3.91 for 2025, which is in the top half of the guidance range, with expectations of over 8% annual growth through 2029 [3][25] - Retail sales increased approximately 4% in 2025, with industrial sales contributing a 7% increase [25][26] - The company anticipates an 8% compound annual growth rate in retail sales through 2029, driven by a 15% growth in industrial sales [4][26] Business Line Data and Key Metrics Changes - The company achieved 4% sales growth in 2025, primarily driven by industrial sales [4] - Significant electric service agreements totaling approximately 3.5 gigawatts were signed in 2025, indicating strong demand from data centers and traditional industrial segments [5][6] - The company has a pipeline of 7-12 gigawatts for data centers and 3-5 gigawatts for other industries, with a clear line of sight on equipment to serve 8 gigawatts of incremental load [6][12] Market Data and Key Metrics Changes - Entergy's utility remains in the first quartile for Net Promoter Score for both residential and business customers, with Entergy Texas ranked number one in customer satisfaction for business electric service in the South [4] - The company noted record employment milestones across all states in 2025, reflecting positive economic development activity [8] Company Strategy and Development Direction - The company is focused on a customer-first strategy that aims to create value for all stakeholders, with a $43 billion capital plan through 2029 to support customer needs [11][25] - The company is exploring new rate offerings such as demand response and time of use rates to complement existing billing options [10] - Entergy is committed to maintaining low rates while improving customer experience and reliability through investments in infrastructure [4][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth outlook, citing strong demand from data centers and industrial sectors [5][25] - The company is proactive in addressing equity needs and has secured significant credit requirements to protect existing customers [31][43] - Management acknowledged the impact of Winter Storm Fern on operations, estimating restoration costs of up to $300 million for Louisiana and up to $200 million for Mississippi [31] Other Important Information - The company plans to host an Investor Day on June 9 in New York City to discuss significant opportunities and provide a five-year outlook [24] - The company has implemented various programs to improve reliability and reduce outages, funded by data center revenues [9][10] Q&A Session Summary Question: On the large load ramp, was phase one of Hut 8 already partially in plan? - Management indicated that Hut 8 is included in the probability-weighted growth but does not add to the capital plan at this stage [38][39] Question: What protections are in place for large load customers? - Management confirmed that significant credit requirements, including termination fees and minimum bills, are in place to protect against customer walkaways [42][43] Question: What updates should be expected at the Investor Day? - Management stated that the Investor Day will provide more clarity on data center contracts and a longer-term outlook, with potential announcements depending on timing [68] Question: How is the company addressing customer benefits from data centers? - Management explained that the $5 billion in rate offsets is related to contributions to fixed costs and investments in resilience and reliability [60][61] Question: What is the status of the Cottonwood addition to the capital plan? - Management confirmed that Cottonwood is included in the capital plan and is pending regulatory approval [61]

Financial Data and Key Metrics Changes - For Q4 2025, the company reported a GAAP net loss attributable to common stockholders of $27.4 million, or -$0.58 per basic common share, which includes a provision for credit losses of $14.4 million and an impairment loss in the Miami Beach REO asset of $6.8 million [16] - The book value at December 31 was $7.29 per common share, a decline of $0.65 per share from Q3, primarily due to the provision for credit losses and impairment loss on REO [16] - The aggregate CECL reserve at December 31 was approximately $148 million, an increase from $134 million in the previous quarter, mainly due to an increase in specific reserves on collateral-dependent loans [17] Business Line Data and Key Metrics Changes - The total loan portfolio commitments at year-end were $1.8 billion, with an outstanding principal balance of $1.7 billion and about $77 million of future fundings, accounting for only 4% of total commitments [10] - The realized loan portfolio yield for Q4 was 6.7%, which would have been 8% excluding nonaccrual loans [10] - The company had an active year of loan repayments and resolutions totaling about $469 million during 2025, with $45 million of loan repayments in Q4 [11] Market Data and Key Metrics Changes - The commercial real estate industry experienced strong momentum in 2025, with increased capital availability and improved fundamentals across many markets and property types [5] - Larger commercial banks became more active in warehouse financing, and regional banks began returning to the market, contributing to greater liquidity [6] - The market momentum from 2025 continued into early 2026, setting the stage for potentially stronger transaction activity across property types [7] Company Strategy and Development Direction - The company aims to reduce higher-cost debt and focus on asset resolutions in the first half of 2026, with plans to begin regrowing the portfolio in the latter half of the year [9] - The strategy includes reallocating capital in the portfolio and recycling into new originations as a high priority [9] - The company is focused on loan and REO resolutions, expecting the portfolio balance to trend lower in the near term until new originations begin [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the market conditions, indicating that 2026 could be a stronger year for the industry with forecasted growth in transaction activity and increased liquidity from traditional lenders [7] - The management acknowledged the risks associated with credit migration and potential future losses, emphasizing that the current reserves are appropriate [25][26] - The company is monitoring the situation closely regarding specific loans and expects to have more updates in the coming quarters [12] Other Important Information - The company has received two full loan repayments of $174 million combined post-quarter end [9] - The company continues to invest in its REO assets to maximize outcomes and is actively engaged in value-enhancing repositioning opportunities [13] Q&A Session Summary Question: How does the company view the economics of new origination versus returning capital to shareholders? - The company plans to focus on resolving loans and decreasing leverage until it resumes origination later in the year [20] Question: What is the current reserve position and likelihood for further reserve build? - The company updates its CECL process quarterly, with the current reserve reflecting the latest economic forecasts, and believes it is appropriately reserved for collateral-dependent loans [21][22] Question: What are the expectations for book value per share and future losses? - Management acknowledged the risk of upgrades and downgrades in credit migration and indicated that future losses may occur, but they are embedded in the current reserves [25] Question: What is the visibility on scheduled maturities and portfolio size? - The company expects the portfolio to decrease through mid-2026 before stabilizing and regrowing later in the year, with ongoing communication with borrowers regarding upcoming maturities [36][40]

Financial Data and Key Metrics Changes - The company reported a net profit of $172.6 million for Q4 2025, representing a 5.3% increase in earnings per share compared to Q4 2024, with earnings per share at $4.18 [11] - Operating profit for the quarter was $209.6 million, resulting in an operating margin of 21.8% [11] - For the full year 2025, the net profit reached $671.6 million, or $16.28 per share, an 11.9% year-over-year increase [14] - Operating income for the full year was $819 million, an 8.8% increase year-over-year, with operating margins at 22.6% [14] Business Line Data and Key Metrics Changes - Capacity increased by 9.9% year-over-year in Q4, while passenger traffic rose by 10.1%, leading to a load factor increase of 0.2 percentage points to 86.4% [5] - For the full year, capacity in ASMs grew by 7.8%, and passenger traffic in RPMs increased by 8.6%, resulting in a load factor increase of 0.7 percentage points to 87% [6] Market Data and Key Metrics Changes - The company noted strong demand trends across the region, supported by healthy travel activity, which allows leveraging the advantages of its Hub of the Americas [8] - The company is experiencing improved demand and better yields due to stronger local currencies in South America [26] Company Strategy and Development Direction - The company plans to grow capacity by 11%-13% in 2026, with approximately half of this growth attributed to the full-year impact of capacity added in 2025 [8][18] - The company continues to expand its network, adding frequencies and new cities to its Hub of the Americas, reinforcing its competitive position [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth plan and the current demand environment, which supports expectations for strong margins in 2026 [8] - The company anticipates an operating margin within the range of 22%-24% for 2026, based on a load factor of approximately 87% and unit revenues of around 11.2 cents [18] Other Important Information - The company has a total cash, short-term, and long-term investments of $1.6 billion, representing 44% of last 12-month revenues [15] - The board of directors approved a quarterly dividend payment of $1.71 per share for 2026, with the first payment scheduled for March 13 [16] Q&A Session Summary Question: Impact of developments in Venezuela on demand - The company resumed flights to Venezuela and plans to gradually add capacity throughout 2026 [21] Question: Wi-Fi service provider selection - The company has chosen a provider for Wi-Fi service, with details to be announced in April [22] Question: Effects of stronger local currencies on demand - The company is seeing improved demand and better yields due to stronger currencies in South America [26] Question: Guidance on RASM despite increased capacity - Management explained that the guidance for flat RASM considers the full-year effect of growth in 2025 and additional frequencies in existing markets [30] Question: CASM ex-fuel guidance - Management indicated confidence in achieving a CASM ex-fuel of approximately 5.7 cents, supported by various cost-saving initiatives [34] Question: Buyback program status - The company has executed approximately half of the $200 million buyback program approved by the board [91] Question: Potential impact of Brazilian law on costs - Management noted that the suspension of law 400 in Brazil could lead to significant cost savings for the airline [95]

CoreCivic (NYSE:CXW) Q4 2025 Earnings call February 12, 2026 11:00 AM ET Speaker9day, and thank you for standing by. Welcome to the Q4 2025 CoreCivic Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press ...

Financial Data and Key Metrics Changes - In Q4 2025, natural gas and oil sales increased to $365 million, an 8% rise compared to Q4 2024, despite lower production [5][9] - The company generated $222 million of operating cash flow, or $0.75 per share, with adjusted EBITDAX of $277 million and adjusted net income of $46 million, or $0.16 per share [6][10] - For the full year 2025, production averaged 1.2 Bcfe per day, a 14% decrease from 2024, but oil and gas sales rose by 15% to $1.4 billion due to improved natural gas prices [10][11] Business Line Data and Key Metrics Changes - In 2025, the company drilled 52 successful operated Haynesville Bossier wells with an average initial production (IP) rate of 27 million cubic feet per day [3][4] - The company turned 12 new Western Haynesville wells to sales in 2025, with an average lateral length of 8,399 feet and an average IP rate of 29 million cubic feet per day [6][26] - In the Legacy Haynesville, 35 wells were turned to sales in 2025, with an average lateral length of 11,738 feet and an average IP rate of 25 million cubic feet per day [25][26] Market Data and Key Metrics Changes - The average NYMEX settlement price for natural gas in Q4 was $3.55, while the average Henry Hub spot price was $3.69, approximately 4% higher than the NYMEX price [11][12] - The company sold 27% of its gas in the spot market during the quarter, with a realized gas price of $3.29, reflecting a basis differential compared to the NYMEX settlement price [12] Company Strategy and Development Direction - The company plans to focus on building out its assets in the Western Haynesville to benefit from long-term growth in natural gas demand driven by LNG exports and data center power needs [37][39] - A partnership with NextEra for a data center project aims to support hyperscaler development with an initial capacity of 2 gigawatts, potentially expanding to 8 gigawatts [4][38] - The company aims to maintain the lowest producing cost structure in the industry while enhancing drilling efficiencies to reduce costs further in 2026 [38][42] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the volatility in gas prices and indicated flexibility in capital spending based on market conditions [50][51] - The company expects to see a growth in natural gas demand of about 3 Bcf annually through 2030, driven by LNG facilities and data centers [53][55] - Management expressed confidence in the potential of the Western Haynesville, estimating recoverable reserves could reach 99 TCF [39][40] Other Important Information - The company completed $445 million in divestitures in 2025, improving its balance sheet and reducing debt [4][5] - The total shareholder return over the last two years was 162%, the highest among public E&P companies [5] Q&A Session Summary Question: Guidance and Capital Spending Flexibility - Management confirmed that the capital budget was prepared in a more constructive gas environment and emphasized the ability to adjust capital spending based on gas prices [47][50] Question: NextEra Partnership and Data Center Project - Management discussed the potential scaling of the data center project from 2 GW to 8 GW, highlighting the demand for such infrastructure in Texas [56][58] Question: Pinnacle Gas Services Recapitalization - Management outlined plans to recapitalize Pinnacle Gas Services, including eliminating preferred equity and establishing a new credit facility [61][62]

Financial Data and Key Metrics Changes - Full year 2025 revenue was $3.2 billion, reflecting growth of 8.7% year-over-year, driven primarily by the acquisition of Parker and strong international expansion [21] - Adjusted EBITDA for the full year was $913 million, $31 million higher than the prior year [21] - Fourth quarter consolidated revenue was $798 million, a decrease of $21 million or 2.5% sequentially, primarily due to the divestiture of Quail Tools [21][22] - Adjusted EBITDA for the fourth quarter totaled $222 million, representing an EBITDA margin of 27.8%, down 110 basis points sequentially [22] Business Line Data and Key Metrics Changes - International drilling revenue was $424 million, growth of $17 million or 4.1% sequentially, with EBITDA for the segment increasing to $131 million [23][24] - U.S. drilling revenue for the fourth quarter was $241 million, reflecting a 3.7% sequential decline, while EBITDA totaled $93 million, a decrease of 1% [25] - The drilling solutions segment generated revenue of $108 million in the fourth quarter, with EBITDA of $41 million, resulting in an EBITDA margin of 38.3% [28] Market Data and Key Metrics Changes - The average daily rig margin for international drilling was $17,630, which decreased sequentially by $301 [24] - The gas-directed industry rig count in the Lower 48 increased by more than 20% in 2025, with Nabors' gas rig count increasing by 50% [10] - The average rig count in international drilling increased by 4 rigs to 93.3, exceeding expectations [24] Company Strategy and Development Direction - The company aims to focus on performance excellence in the Lower 48 rig market and expand in the international drilling market [6][7] - The commitment to innovative technology and multi-year contracts is expected to enhance operational efficiencies and capabilities [7] - The integration of Parker Wellbore is progressing well, with expectations to generate at least $70 million of EBITDA in 2026 from retained Parker businesses [36] Management's Comments on Operating Environment and Future Outlook - Management noted that oil prices were in a downward trend in the second half of 2025, but recent events could lead to price increases [8] - The outlook for natural gas remains positive, with expectations for increased LNG exports and domestic consumption [10] - Management expressed confidence in the company's ability to maintain momentum despite market uncertainties, particularly in the Lower 48 [51] Other Important Information - The company reduced net debt by $554 million, significantly de-risking its capital structure and reducing annualized cash interest expense by approximately $45 million [5] - Adjusted free cash flow for the fourth quarter was $132 million, driving full-year adjusted free cash flow to approximately $117 million [39] - The company expects to generate free cash flow outside SANAD and is committed to further debt reduction [18] Q&A Session Summary Question: Lower 48 outlook and rig count increase - Management indicated that the rig count is currently at 66, with a focus on public operators and longer laterals, which are well-suited for Nabors' PACE-X rigs [48][50] Question: Updates on Saudi Arabia operations - Management expressed confidence in the timelines for reactivating rigs and new builds in Saudi Arabia, noting a positive signal from Aramco's actions [58][60] Question: Activity in Mexico and additional rigs - Management confirmed discussions about additional rigs in Mexico, focusing on making existing rigs profitable first [65] Question: Capital expenditures and SANAD program - Management clarified that the expected capital expenditures for SANAD new builds would be around $360 million to $380 million for 2026, with a focus on maintaining cash flow [66][67]