OIL STATES INTERNATIONAL, INC Q4 FY2024 earnings call

• Continued to build momentum towards strategic objectives with strong demand in offshore and international markets despite headwinds in US domestic land-based operations.
• International and offshore revenues and bookings grew 6% sequentially in Q4. Completed sale of a previously idled facility, netting $24.8 million in cash proceeds and a pre-tax gain of $15.3 million.
• US land-driven operations were offset by improvements in offshore and international regions due to fourth quarter seasonality. Completion and production work in the Gulf of America rebounded early in 2025. Generated $18 million in cash flows from operations and repurchased $9 million of common stock during the quarter, and aims to continue returning cash to shareholders.

Offshore manufactured product segment: Grew 5% sequentially in Q4, generated revenues of $107 million and adjusted segment EBITDA of $25 million, up 6% sequentially. Adjusted segment EBITDA margin was 23% in Q4. Completion and production services segment: Generated revenues of $30 million and adjusted segment EBITDA of $3.5 million in Q4. Excluding certain charges, adjusted segment EBITDA was 12% in Q4. Downhole technology segment: Reported revenues of $27 million and breakeven adjusted segment EBITDA for Q4. International and offshore revenues by destination grew to 72% of consolidated revenues for the quarter, while US land-driven revenues represented 28%.

• 2025 full-year revenues expected to range between $700 and $735 million and full-year EBITDA to range between $88 and $93 million.
• First quarter 2025 guidance: Revenues in range of $160 to $170 million and EBITDA of $17.5 to $18.5 million.
• 2025 cash flows from operations expected to be in range of $65 to $75 million, with CapEx of approximately $25 million planned, providing opportunities for ongoing share repurchases.

• Factors affecting the business include those disclosed in the 2023 Form 10-K and other recent SEC filings, such as risks related to domestic market conditions, activity levels, seasonality, weather events, etc.

Q: Cindy, you kind of alluded to free cash flow of looks like $40 million to $50 million next in 2025. What do you are you focused on buybacks over debt reduction at this point? Like, how do you think about the allocation of the free cash?

A: We feel very comfortable with our debt levels. I think you saw we executed in Q4 with share repurchases. Yes, we do have our debt maturing in April, but at the end of the year, we noted we had roughly $60 million of net debt. In Lloyd's comments, we had some very large receivable collected on January ninth, I think. And so I think the point of that is we were roughly net debt $45 million in January. And so we're really not concerned with the level of debt that we have at this point. And I think it is prudent to focus on shareholder returns.

Q: If we could just ask one more quick one, and that is, without asking you sort of specifics, you've sort of talked about streamlining opportunities and focusing on more value-added product lines. Of the revenue guidance you gave, if you just kinda use that as a framework or even 2024, like, what percentage of that do you think falls in that category?

A: I'm not sure I understand what you're asking, Steven. Lloyd Hajdik: So first off, what we we did put in the press release that the revenue impact from the exited operations in 2024 was $41 million. So that's I think that's your starting point. Cindy Taylor: Yeah. I said I think the point of what Lloyd is saying you're may be modeling different revenue mix. Right. Because of these exited businesses. But, fundamentally, the mix and the margin profile has improved, and it is more exposed to offshore and international and more differentiated technology than it was before.

Q: Jim Rollyson asked about the margin profile in the Completion and Production Services segment for 2025 given what happened in 2024.

A: Yeah. I'm looking to Lloyd to kinda tell me what it was for 2024, but I think it was mid-teens range. I'm sure you have that in front of you. And we are trying to move those margins more into the 19% to 20% range in 2025. So very substantial EBITDA these are EBITDA margins. Improvement. And even last year, a lot of those were impairment charges. They weren't necessarily cash cost. Some were. But as we go forward, this is a much cleaner year. We envision that today. We've gotten through a lot of this work. You know, our employees on the phone should know that this is largely behind us. And it'll pay off. And I should also mention, in completion and production services, we have a mix of businesses, part of which is international weighted to the Middle East, part of which is Gulf of Mexico, and I meant or Gulf of America as it is now called. So that mix shifts to, again, a little more international, offshore, mix of business, which generally is a little higher margin, and more resilient, albeit, you know, the Gulf of America rig count low. It's beneficial work at good margins. And so that mix helps us as we go forward. And then again, the drag has been just the cost structure and some of the low to no margin contributing businesses that are no longer in our portfolio.

Q: Blake McLean asked about the international and offshore opportunity set and the trajectory of US land activity.

A: Cindy Taylor provided details on differentiated technology in Brazil, Southeast Asia, CCS, and US land activity being selective with product offering, seeing lift in activity in January, and being region and customer specific with new technology introductions.