OIL STATES INTERNATIONAL, INC Q3 FY2024 earnings call

• Offshore/Manufactured Products had strong results, including largest bookings quarter of the year, collaboration with Seadrill, and delivery of Integrated Riser Joints to Seadrill. - Continued streamlining U.S. operations with sale of drilling rigs and change of Well Site Services to Completion and Production Services. - Generated $29 million in cash flows from operations, reduced net debt by $20 million, and changed share repurchase program with new $50 million authorization expiring in October 2026.

Offshore/Manufactured Products segment revenues totaled $102 million, adjusted segment EBITDA totaled $23 million. Bookings totaled $112 million, up 11% sequentially, yielding a backlog of $313 million as of September 30th and a quarterly book-to-bill ratio of 1.1x. This segment constitutes 65% of consolidated revenue. Completion and Production Services segment revenues decreased 14% sequentially due to U.S. land activity decline and Gulf of Mexico issues, with revenues at $40 million and adjusted segment EBITDA at $5.4 million. Downhole Technologies segment reported revenues of $32 million and adjusted segment EBITDA of $1 million, decreased from prior quarter due to macro issues.

• Expect fourth quarter adjusted EBITDA to range between $20 million and $23 million, free cash flow ~$20 million with $25 million facility sale proceeds. - Net debt expected to fall below $45 million at year-end 2024. - Anticipate EBITDA margins to improve in 2025, with Completion and Production Services and Downhole Technologies segments expected to improve with restructuring and new technology introductions.

• Potentially reduced oil demand in China and possibility of OPEC+ ceasing voluntary production cuts. - Gulf of Mexico hurricane impact on offshore activity affecting Completion and Production Services segment.

Q: Jim Rollyson asked about the margin profile of Completion and Production Services and Downhole Technologies as they move forward.

A: Cindy Taylor stated they are doing pro forma modeling, expect material increases in EBITDA margins from Completion and Production Services, with 2025 margins expected to be 23%-25%, and Downhole Technologies having dual strategy with EPIC technology rollout and international penetration.

Q: Stephen Gengaro asked about backlog conversion and margins of Offshore/Manufactured Products.

A: Cindy Taylor mentioned about 75% of backlog turns in forward 12 months, and margins are sustainably higher than before with room to go, sticking to 19%-20% range annually.

Q: Sean Mitchell asked about Gulf of Mexico outlook and international markets.

A: Cindy Taylor said offshore business is high margin, outlook for Gulf in 2025 is solid, and international markets like Brazil, Guyana, Africa have opportunities in production infrastructure and new step-out fields.