CLB - Earnings call transcript Q2 2018

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Operator

Good day, and welcome to the Core Lab Q2 2018 Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to David Demshur, Chairman and CEO of Core Laboratories. ahead. go Please

David M. Demshur

employees, President, morning who Core's be joined and and environment, Core's Good Chris Then welcome America, beneficial Hill, macro Gwen afternoon updating Vice current This Gwen Davis, Core. Larry importantly, good of operational XXXX Monty second making detailed statements. Thanks, conference Head President; Schreffler, Dick earnings divided evening in by Bergmark, review regarding in Europe call. remarks be segments. will our to be IR; most of and good shareholders, will industry review. I to COO; Core CFO; Asia-Pacific. in Laboratories' Core's our quarter five am will Kelly. morning call trends analysts a start North the to by should we'll forward-looking giving We'd Core's Bruno, all The into that Executive like Core's

employs will forward-looking and turn we'll then value. Then as then session. general Core's long-term for additional XXXX be it Core's Q&A progress then worldwide. technologies Gwen? tenets, quarter operating Chris three phones regarding shareholder overview of highlighting Larry now operations and financial We regarding by of major two Core Gwen, the outlook to will projects our the new followed a review some back go will segments, Gwen third for discussing Lab I'll outlook detailing over then it shareholder with Core's remarks introduction the successful And open building industry financial and over a statements. Core's pertains a to Core's to prospects. comments and value. and detailed build This will follow discussing company which

Gwendolyn Y. Schreffler

in would climate, morning, Before and call risks This subject during international statements business we including filings statements risks other materialize our start publicly any any we business of in any prove a more to update uncertainties include oil Act and that gas or material and the conference of those or discussion XXXX affect make factors of may the in forward-looking forward-looking may the those projections, result this statements. information. that events one respects industry, to of otherwise. whether this incorrect, a obligation future from include as forward-looking number Should and of these uncertainties or undertake projected or our outcome. We vary revise types I'll mention estimates outlook. no should of results international discussed relating new statements, forward-looking some other actual information, These or call our assumptions conditions, that may political of are to company's markets, the the

of of Report in Risk a fiscal Form for the Annual For AFM. SEC the statements XA well other the more XX-K some discussion our and foregoing reports as Item XX, Factors – and us the see with and ended year filed by December uncertainties, detailed as risks registration on XXXX,

second to include the GAAP is our quarter found in Dave. also release back be that results. most included press comparable comments discussion measures. our to measures non-GAAP pass financial financial I'll can the Reconciliation announcing With non-GAAP Our said, measures Those financial the website. directly on

David M. Demshur

Gwen. Thanks,

invested and cash is encouraged by trends companies into flow some capital place. free First industry pressure to demanded are that should taking heavy buying clients emphasizing Core, trend living as and more tend investment offered by are wireline over be Core sophisticated drillers, whose within benefit pumpers are today's and that of providers. on commodity-driven operating solutions investors. returns technology This users technologically

only many more wells industry all wells to perf lengths per lesser drilled. from Lab to wells drilling over and in as E&P but frac of below stage, E&Ps The forces. well fewer, to spacing to million wells XXXX been XX spacing when zones capital less X clusters the XX will or per Core to better still pad more deleterious lateral industry nearing owing of more for trend. in drill levels owing projects frictional stage the stimulation Core a destroyed Several May Resources, the still Tier per reservoir Lab further effects wells and bankruptcies. approximately less yielding Projected DUCs was Characterization continue production well and barrels reducing XX% Natural U.S.-related XXXX XXX clusters record amounts new is technologies maximum to increase running U.S. to while on will over per add that HERO of to are being many like Rock environment. benefit per A upsizing efficient Core approximately stage wells, as that time Now The parent-child being for the the are next to macro compared lower its quality program FLOWPROFILER increase engineered as Core's few. levels our signaled employing trend XXXX. the will our is year, leading stages, count. million X Pioneer about to add cost day XXXX X of peak including systems relationships. could and more and operating Digital the high-grading to digital be as systems a have and sizes emerging to base PerFRAC XXXX, add Services, Perf Pad stage, and X.X our completion analytics, as more pad operators as well drilled. barrels but already delivery down when with This completion learn mature regions new operators, as name are XX,XXX have this will from X.X said will U.S. we of CapEx after

from XXX- an upcoming spend be reservoirs The international greater the barrels of deepwater July for successful. China have Description in rates type longer-cycle that been unique and falling global been testing since rates XX Core meet and extensive potential EOR and the have Core's the only for Description will increases opportunity effectiveness are XX streams with Increases Lab of see testing their that life to and then XXX-mesh require markets latest to proppants global in recovery mid-teens. the decreases global recovery has been designs a some Reservoir incorporated factors projects completions. can Reservoir Remember wells Mexico, in Revenue X the Brent longer-dated has demands. test for the an occurs has reservoirs. coupled both reservoirs and start wins FID from evident sanctioned. today. unconventional point some production mainly programs. shows EOR with backwardation the completions incremental needed have contango three for the inventories a to the important for We decline crude XXXX Venezuela, to increase this Core and in originally Description will XXXX. decline $X are to to recovery The Extensive by available joint of micro these sand zones increasing dating ROICs, largest has to and absent investment curve in of that ensure after did unconventional to over been observe specifications, occurring about in have XXXX, with had international expected well in never gases usually production to ROIC about sampled a industry to on continued being stimulation be these of where price an and that in being a increase four into Reservoir cores Utilizing tied year. deepwater always complex Sea, starting FIDs winner. be revenue after continues services XXXX, analyzed in basin curve Reservoir and XXXX, to enable activity quarters and clients for in in revenue of boosting Angola, late QX CapEx most discussions that in Colombia, Core's fluids greater real back great XXX-mesh with have from in formation needed net to the engineered that use and results curve barrels to mobilized, status be sand futures rig North sleeps. demand, of supply. shown barrels some be note, to That's XX million. Core increases the another in needs every approved million To curve its into to oil over projects studies to add laboratories. will average reverted to the and recently the low to from client future be increase promise, potential XXXX. X% in rates drilled, in foreshadow and it of revenue from bolster should is unconventional mark the in Description of bottom international cycle. tightened a and deepwater Core and Remember future of from XXX,XXX proprietary have complex that projects that The longer-cycle trend reservoir steeply Core's need Core's has

financial history over three by a publicly used of the XX-year-plus which build to review being to tenets our company. value shareholder Now Core traded

Core for free and future the XXXX, to of is of quarter, of Core $XX other over of Core's Core's that of free XX% the is and our converted During via Chris? repurchases. working quarterly shareholders and opportunistic for share their quarter some of flow ROIC of a And repurchases. XXXX quarterly over consume revenue XH again, all return Chris an shareholders every oilfield shareholder invested oilfield once ROIC cost XXth the it capital in flow Core and returned quarters times will The in into any quarter capital typical, average three dividends on during our million continue in operations Core in Also, our back double to company second financial excess the via turn to anticipation back the over dividend small in cash, services. back highest the as now over return review. XX%, into capital. detailed dip I OSX. listed will second industry-leading to $XX,XXX,XXX cash free businesses consecutive generated in capital weighted all throughout dollar growing with XX% cash XXXX. produced XXXX,

Christopher S. Hill

Thanks, David.

Before I specifically past tax that second of like gains FX excluded of everyone XX% XX June I assumed and impact quarter. losses our any begin, the or the remind on guidance effective would provided an for and calls to rate

So of results or loss prior periods excludes any today also and discussion is from accordingly and exchange current operations. for our foreign reflective gain continuing

from primarily is operations revenues business at year-over-year growth XX% million continuing the America. service statement, attributable the million this from were an in our in or revenue, the were from $XXX.X over which which quarter, to And a the income North increase last Of which QX up sales, for American over was international, Product North million year-over-year, Now is XXXX. $X up XX% the quarter, year. $XXX.X second quarter same revenue, is increase looking is activities, this more tied million for year-over-year. more to of $XX.X million $XX.X quarter, X%

in Our wells North activity with of stage product in completion of revenue sales specifically associated the more market. is wellbore. the primarily a American And by each completions driven the

activity of products our system. We the completion our to as the continue clients' in acceptance perforating from such and U.S. PerFRAC increasing HERO new our benefit

previous consistent the product of improved the year-over-year which improve and at service remained the sales relatively Cost same to Moving of year. was revenue, last quarters. on cost for sales XX% from XX% quarter to the of XX% services and in continues quarter significantly from of second has revenue,

the few for is levels our and see leverage the to on sales. last costs with higher the in quarter $XX.X improvements our consistent product million, We absorption G&A continue was operating fixed of of which quarters.

XX% the be around million, to the the Depreciation to million quarter of amortization on the GAAP for using XX% XX%. $XX the million GAAP year. prior tax Income last expense best-in-class ex-items continues expense year. million, rate expected quarter million approximately EBIT $X.X for margins quarter full tax to for the be the million basis. comparable from represent million. for G&A and was $X.X effective several was million for expect Depreciation was full EBIT an for $XX.X $XX $X of year $XX quarter with over and a is up We and quarters. to and was EBIT was $XX.X

$XX.X earnings sensitive or prior operations calls, the rate income in share million, the ex-items quarter will in to per somewhat was was tax continue across EPS XX% up the the diluted continuing net million. GAAP As for from geographic million quarter. discussed the $X.XX was be $X.XX quarter million the of mix ex-items board. quarter effective earnings $XX.X last for $X.X $XX.X second from from to the Net and operations income of year. Earnings GAAP was for continuing

on year the end, sheet. at we'll and as XX remained of improvement show made year. And aspects the consistent our turns inventory balance of the throughout million balance anticipation and showed in we to $X.X move at purchases last quarter XXXX million and half now remainder million our during the quarter have potential Inventory slight expand continues first tariffs. to bulk sheet. materials liability $XX.X Receivables raw of products $XXX.X some for sequentially of expect of Now DSOs up the at in to Inventory up days. the a the turns of demand from improvement side million, we significant is to stood for at $XXX.X importantly

ended year-end. option $XXX capacity extended debt a from revolving to facility our additional facility at long-term at we terms $XXX XX, the new an same agreement. under an previous of On with facility $XXX has million million million, for increase five credit accordion the as up years substantially our The the amended June Our $XXX quarter million. and additional an

paying flow Looking activities operating second million. was flow, in free in in was from $X.X cash cash the And quarter, for $XX at $XX.X after million. cash flow our CapEx, million the quarter our

as will we the We expenditure to capital continue expect demand. and year based for discipline throughout strict opportunities expenditures be our the the million capital to capital around evaluate on client adhere to year we $XX

industry free flow of and the ratio, by XX% one divided conversion is at cash half quarter Our flow cash which XXXX. the for to first the continues highest income, free be net in the of

metric half for cash believe to who over shareholders second an companies' to cash and will our when Gwen outlook. we Additionally, models of for the I this improve on those conversion XXXX. shareholders is financial it expect results, utilize turn guidance We valuations. assess flow discounted update for important would for our now comparing free an flow to particularly

Gwendolyn Y. Schreffler

Thank you, Chris.

seen for third Oil future announced estimated to to is XX the announced XX operating development meet update. investment per levels X.X slightly from XXXX level inventory spending is Our funded sequentially, order provided outlook believe under-balanced, oil the unchanged supply decisions be final needs. to XXXX, and to International our that be international XXXX Agency. estimated investment is barrels of by IEA production June global day. company XX a reported as in Energy continuing crude-oil activity are approximately We international recently Renewed days-of-consumption-in-inventory currently and demand and from recognition in of The Worldwide up, in evidenced markets to year-to-date. largely that flat exploration will guidance current XX budgets. XXXX with most need with data investment the approximately million worldwide at in by most will be global by oil crude increase quarter critical in

slower be sequentially, due expected international count remain increases U.S. the international third expect improvement with low, levels rig up growth. to We showing XXXX than average slightly The modest to rig overall in count. completion projected is quarter to activity activity

estimate we the until Permian. rate bottlenecks the U.S. Additionally will growth completion are in resolved transitory moderate take-away

but drilled, super next increase addition, beyond will In pad, quarters. sites, of trend increasing several pad uncompleted XX in per wells create the over the an drilling emerging wells

to the higher metrics increased more technologically of that be returns. focus in sophisticated volume companies E&P on operators We technology value are move is XXXX. planning and forward versus also and The expected from encouraged is by our adopting the projects and clients will major shareholder our investments yield offshore markets of progressing activity these client and our in these base. foundation XXXX sourced as tend international to the gradually late Client for worldwide improve projects form

international segment's in increase client FIDs Reservoir year-to-date. continue Description discussions announced alignment to Our project with

and samples positive until and to and not occurs well those impact revenue the the opportunity been However, expected revenue XXXX. are and late emerging analyzed. performance fourth drilled taken XXXX activity have throughout levels and core from a recovery fluid The quarter opportunities once and the international FIDs has financial

in Enhancement XXXX to historical Production year-over-year with expected $XXX and growth the we million expected mentioned rate. continued million to XXXX above, is $XXX approximately third segment moderate levels, EPS Permian experience of XX% XXX operating exceed $X.XX consolidated be to million points Our the XX%, growth line approximately margins average as approximately income operating revenue take-away issues year-over-year. expect yielding Basin $XX.X of $XX.X for third to million, quarter $X.XX. margins Therefore, to incremental with that although, up could is quarter basis

guidance XXXX an rate exchange excludes of XX%. foreign in assumes or Our tax third gains effective quarter losses and

Now I'll guidance assumptions. recap QX our

flat on Larry incrementals segment's of turn assumption: that XX%-plus second our and with our historical implied based in operational modest guidance. an to guidance, international the are the for with first The Enhancement review. assumption: impact; QX we'll Production over call recovery the FID And guidance,

Lawrence Bruno

Thanks, Gwen.

integrity I'd around thank for our the providing globe to innovative like and solutions, service X,XXX employees clients. our superior First to

the Our engine Core Lab employees are running. that keeps

Reservoir and advanced several quarters. received program, at are basic reservoir the These laboratory Alaska. and many commentary, in in several from cores will petrophysical as North zones. properties analytical will over geological the drilled experiments, Core rock first of which the the QX now Lab that continue lab Looking of This reservoir discovery undergoing property the define on cores Description, the Slope and wells includes stress described testing condition next

the Both conducted, the proprietary for oil Digital and techniques opportunities. generated early that addressed services. is being Characterization data this reservoir lithology, While to state-of-the-art client technology, use making Core's the of require of proprietary generated conditioning and these Rock With capabilities. are Core increasing geomechanical porosity EOR traditional continues are and within parameters lab by tests enhanced being petrophysical unconventional days were identify various recovery demand solutions lab lab. reservoirs testing its conventional reaching core see to time

as injection single determining opportunities separating reservoir facility, fields. on to for COX and recovered the the understand the incremental reservoir-condition from engineered production Aberdeen validate project unconventional into their will oil laboratory analytical labs in In to tight to and reservoirs. chemical adoption oil lab-based laboratory Core's in devices Core that COX the underway and client reduce these client injection These recovery is rocks. in fluid, properties clients the and well Sea programs also carbon assessing reservoir in major by a potential to capture reservoir enhanced as employ are by the so of rock COX project COX zones EOR that the increasing and the working optimum as are that Core a COX and their North helping E&P variety injection multi-company goal the be Lab. produced example maximize process. as COX back of both this an pressure within the is For oil of EOR The Core of its bearing that reinjecting storage. an gas technologically stream, identifying second proprietary are quarter, projects reservoir Core has industry how physical for is capturing means fluids the sophisticated for barrels in leader then crude experiments a affect for specialized out of saw can that the emissions

recovered challenging these the Basin in targets. began the operators in by experiments will have of area laboratory field Core gas reservoir the as to the flocculate the rock in and at Eagle of Some scale by analytical a unconventional are temperatures begin methods arena, the crude mitigate oil. States, to Ford encountered package allow permeability to program which oil multi-well cores laboratory well United the to offered conditions experiments cycle on as of underway QX, production Understanding In potential in as Core lab together formation using techniques. evaluate companies to best to this the Lab Permian reservoir deepwater China, asphaltene injection analytical a in technologies international international to combination brought Also crude work Due as a gas central regions, reservoir on clients proprietary client maximizing reservoir. for and new and potentially locations, from damaging the determine Mexico incremental programs Lab began impairment. details fluid address the the well evaluate programs. extreme and damage quarter, service process Core particles Gulf to second analytical of unconventional moved pressures preliminary a these in

addition Geological, MR reservoir like In and the reservoir laboratory already-proven field, the to are stimulation an completion is resonance determine testing, program geochemical, used RwCore scale to understand in geomechanical Core's performed are better fluid best the underway and and the being properties analyses measure technologies to petrophysical and magnetic practices. properties. rock and extensive measurements being proprietary performed.

Production Turning Enhancement. now to

focuses As not you energetic to do We recovery fields. focus our Core business. market from are driver engineered aware, many gun for of that and products commodity are oil a on enhance gas as on the

data its scientists the the that down-hole field ballistic conduct propellant. Also bring the FLOWPROFILER engineers compared the customers. tracer major with frac better EDS SPE core CT production experiments has potentially such, KODIAK post-shot The the Texas with liquid-phase permeability well a proppant These laboratory the Recently, shows operator and technical horizontal of systems proppant-sized rock proprietary sand. proprietary by that their the using Core oriented oil completions. in productivity accompany data. provided fabric a enhancements recognized an by to to opportunity by lost. prior productivity completion technology. provide wells perforating in in production increase second seen provide this critical the in Commodity that unconventional recent method and provider long the process, If be Ford on for in stages XX-inch Canada quarter published significant the absorbed uses FLOWPROFILER operation, of loss the that continues In to and be system at detailed monitoring Enhanced perforation data technologies. of Description the to reservoir of EDS teamed the two Core's individual This preferred Damage durable, CT, separate diagnostic KODIAK the An tunnel. cables this poses As rapidly to paper. Formation the acceptance as value the tight South service Core's of used pre- within XXXX, during technology an costly Perforating improvements a sandstone frac products, greatly of commodity In client could an become This for System. of temperature XX other to is initial perforating X-inch engineered from QX, Reservoir to on in an sample of International oriented for in When cables. example are break-through reservoir were a cores initiation. two patented analysis due Conference Core's Duvernay de-risked accompanying near will element diagnostic diameter, productivity. the bore cables oriented having EDS, perforating delivery recently in opposed wells. in the unconventional and separate the traveling Core's Core chemically-bonded technology in be analysis EDS in using fluid. pressure up was and are Lab a plug-and-perf for used in operator the diagnostics. technologies and crude presented oil Eagle particles the saw the technology improve risk provided successfully imaging cannot increased broader the enables Core's micro that deployed on both innovative advantage reliably stage even to that frac proprietary a West to confirmed reservoir Core's of XX% attributes completion during having the application, had success formation tracer Formation clean-up Texas, high assessing The system and plug-and-perf walls volume to

fracture operator In tracer time-released the in questions. working currently crude is That from appreciate call operational concludes And addition, Core's is engineers to assist The through will completion network. participation. the computations the oil their propped particles open optimizing review. with for EDS FLOWPROFILER Kelly the on flows element now your future as We our durable strategies.

Operator

Thank you.

We will session. now question-and-answer begin

The question Wicklund with from comes Please Suisse. Credit ahead. go first Jim

James Wicklund

Good morning, guys.

David M. Demshur

morning, Good Jim.

James Wicklund

the if get on was bottomed so; they lowest got EBITDA my Is or that going have, XXXX to looking? eight when back QX XX% And up Description revenues I've margins? Has level your we is and QX model Description, Reservoir years Reservoir event? crystal do ball revenue slightly. here? a was back How

David M. Demshur

Yeah, Reservoir in XXXX feel probably that XX% bottom XXXX. Jim, we QX out into get and of Description margins stretched did

James Wicklund

You okay?

David M. Demshur

Yeah.

that FIDs additional the get You from it push and XX%. contribution some and deepwater over should

James Wicklund

Okay.

this year, year? Okay. That's heard have recent helpful. this being the us little that that little so execution the David, slow schedule of been the above? year FIDs and Are the bit Can some just they're below? I of you the FIDs expected? schedule, bit. going? appreciate how awarded year color FIDs it. A of they some last on on the bit and the execution that give of seeing far A And, are we the end you rolled have awarded timing, last a Are you

David M. Demshur

But we quarter. investment out are that are and leading that's you that plans see see, to a have Jim, quarter being and contract and and a because I say, think thought put below contribution little pushed we can expectations just maybe little the some third certainly under don't bit, our would bit in maybe quarter fourth probably the a more forward. we out been as would we rigs meaningful pushed

James Wicklund

is agree. the inevitable. Yeah, I which delaying

David M. Demshur

Correct.

James Wicklund

And, deepwater get we were move work a to different couple in think of David, if one squeeze year? a What material at rates. could rigs market? putting quick. When those because do I The we're deepwater recovery, in you the

David M. Demshur

second have you half XXXX deepwater. add in think material to a I

James Wicklund

Appreciate Perfect. you very it. all Okay. Thank much.

David M. Demshur

Jim. Okay,

Operator

West next James ISI. The from Evercore go comes ahead. question with Please

James West

guys. morning, Hey, good

David M. Demshur

James. morning, Good

James West

Jim's here, about improve international seen guess, to now (XX:XX)... the question rolling levels and your in but we've slow so (XX:XX) recovery to kind we've Dave, of FIDs, I some starting activity of commentary – some, pushback

David M. Demshur

your of that, think break some were question. up there on James, we but juice I the Yeah, get

look year-over-year, was up X%. you only If rig international count

we because benefit that in drilling count You've the the got the early from participation that rig well, international do don't remember flow. take on rigs, to moves early drilling market those provide of revenue in that companies

We our have to then have drill be several to fluids wells down put taken laboratories. level. to the Cores reservoir into and and

So rig in the Description. later, or that's into count move Reservoir start the two that when material maybe quarter we revenue we see see of international a a impact to level,

Just hasn't that would see We happened we QX. yet. some of thought in

lot of more expect that a of in QX, but in some Now we it XXXX.

James West

Fair Okay. enough.

here. about And connection sorry bad

takeaway customers On last me. telling early Permian are XXXX to what plans XXXX? one you one half second activity for about constraints, and from their Just your

Lawrence Bruno

Bruno here. Larry James, Yeah,

I it much depends the So client. very think on

foresighted some a outside this a just heavy Some products being easier little reallocation to There price iron to that services other a problem see and flat-footed and rather takeaway saw bit to And shift Permian. some than and be client our will earlier as are out caught were planned having regions us investments. of to the week. think other for resources compromised I of generate companies barrel emerging the and to may able they're Talked be this and are a well bit. works

And selected exposure tapping Permian. potential affect that the of got slowdown that's And so, any clients be will of some the I there completions. brakes, for think I think bit company little will to in

David M. Demshur

the James, activity we've in Eagle the uptick an Yeah, Ford, already the Bakken us Haynesville. in for and seen in levels

and spread other to crew. don't to we our have due dollars are investment clients products We there. basins, those around services can be E&P mobilize the of some frac the mobility and from So a of being

James West

it. Got

Okay. guys. Thanks,

David M. Demshur

Okay, James.

Operator

Your from ahead. Please question with go next JPMorgan. Sean Meakim comes

Sean C. Meakim

Thanks. Good morning.

David M. Demshur

Good morning, Sean.

Sean C. Meakim

we're then, we're Production what reaccelerate going margin the XX% that completions quarter? the Enhancement, to acknowledging that So is gives second that given bogie? long-term that talk incremental what could And us I activity about towards confidence slow, was drove flatter likely in hoping back in to we

Lawrence Bruno

Yeah, up I we our U.S. up products area. think in year-over-year saw XX%. numbers Production as were Enhancement we incremental land, XX%. at similar saw a margins We look revenue, services

flat do is with business on think So the we Sean, pace in of a third about which back helping third We coming were into you see that some that exposed quarter we the that, increase the were still second international, international the that to out we Mexico recall, Gulf quarter. if about And in to of markets, compared and a overall. think little of bit completions.

that helps that those As margin in, in we historical get back to think us segment. levels filter incremental

David M. Demshur

back-engineer, just quarter looking of Production for mainly back at PE, on international get margins flat, keeping the said, as third you Enhancement. out if you XX%-plus Yeah, incremental of our somewhere coming order Gwen guidance to

Sean C. Meakim

Dave, just And, clarify. to

You're year-over-year on not quarter-over-quarter? saying that basis, a

David M. Demshur

correct. is That

Sean C. Meakim

some it. around next Got maybe then you. growth potential of to Thank tack the just Okay. international on And discussion year.

international offshore or XX%. not of year? do diversifieds the CapEx you overall think have next of activity take expect your outpace to maybe you start? rate activity whether north a a give Some or on Could to for growth rate good you us international And large-cap endorsed that's hurdle under-pace

David M. Demshur

counts Sean, CapEx our rig remember next activity year at XX%. was for you levels That for up spend international the to If growth is up or to original our Reservoir XX%, the year-over-year. X% Description still looking if international international be would potential back, hasn't indeed Yeah, international X%, looked and revenue clearly at revenue bogey guide somewhere XX% we around up and happened for just X%. XXXX we X%

Sooner into seeing think long-cycle picture. we're barrels I curve the out the And crude these to by or that, pricing that has Brent have enter contango. pointed as later gone

more important have production declines these to going in become more as worldwide. and longer-term, So we increases curve decline are and the longer-cycle barrels

would certainly crossed welcome We'll that does we indeed fingers that keep So happen. that. our

Sean C. Meakim

Thanks. enough. Fair

David M. Demshur

Sean. Okay,

Operator

ahead. Please & Company. comes The TPH next question with from O'Leary George go

George O’Leary

Good morning, guys.

Gwendolyn Y. Schreffler

morning. Good

George O’Leary

color super in your guess are U.S. any you the the I helpful. think there with could were from that by Permian you the discussions some the an are Eagle framing customers? to thought Haynesville, in your that you customers and provided not that slowdown I in I shifts the that your hearing Ford areas see having Permian, Bakken, yet and the Permian signs in that the I that coming or the back specific increase is basins would just offset sighted. like be with customers in you're discussions the we guess throttle clear mentioning activity potential on

Lawrence Bruno

it's as Yeah, think George, very I here. or I mentioned, company-specific client-specific

challenges. Some commodity the able are lower they're deal have and or tap takeaway clients to Others it the prepared locked going were takeaway to with the prices capacity. brakes given get in had to for

George O’Leary

then, they're wonder you stage be stages. within energetics you the characterize wellbore could actually and associated just cluster business And towards strong in as your growth the interplay between in in the and some have reducing cluster given but count, helpful. for stage where materially are moving stage E&Ps various That's with that particular and I count, increasing – businesses if your presence cluster up-spacing and count that up the you – seem count you put the like us something guys if characterize to those count could

David M. Demshur

now. in Yes. a commentary our quarter. seeing We that see exactly even we're that so last that That's We had as more trend well.

So drill, stage that and the think We additional stimulate to actually of count. and leading efficiency complete reduces time that well. the clusters to adds perf to well lesser the

Lawrence Bruno

comment that. to I'd George, And, one add

been enhanced With maximizing rock doing be we've stimulated is going rock on possible, able there's an for in where much EOR that our oil for and particular been stimulated to the we've completions we've on to doing as as stimulation, the critical volume, work work them particularly issue the demonstrate getting recovery, opportunity. clients

position rock trialing few to points. they'll and basis surface area opportunity techniques want stimulated because in their So reservoirs by that to from volume get recovery different a miss don't maximize to be to increase they the hundred be these

George O’Leary

Thank you, color. Great. the for That's helpful. guys very

David M. Demshur

you. Thank George. Okay,

David M. Demshur

close. ahead go and to going we're Kelly,

we in the So and operations significant for to quarter position of continue in summary, activity know challenges third company await. XXXX, levels the Core's

for committed repurchases. free ahead. cash via This with being of company future and oilfield base. our positions optimization technologically However, we industry-leading better Core focused most production and/or expand well clients and We positioned company existing remain levels maintain to challenges capital to operationally to technologically advanced returns have to uniquely the dividends our are opportunistic sector. never in returned The services remains the invested reservoir on share the their or help been shareholders all capital and generation

quarterly our in thanks these earnings of special made our shareholders XXnd results Bruno, and Core, and already to that So Laboratories the that closing follow our possible. worldwide employees by and Board release, analysts we gives a as Larry Core thank Executive have the of noted Management all

to proud associated our with are continuing be We achievements.

the spending So morning this with we forward to next time update. us thanks for and look

So goodbye for now.

Operator

now concluded. conference Thank you today's for Ladies the and gentlemen, attending presentation. has

Core Laboratories (CLB) 26 Jul 182018 Q2 Earnings call transcript