OIS - Earnings call transcript Q4 2017 | Oil States International, Inc.

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Operator

Welcome to the Oil States International Fourth Quarter 2017 Earnings Conference Call. My name is Victoria and I'll be your operator for today's call. [Operator Instructions]. Please note, this conference is being recorded. And I will now turn the call over to Patricia Gil, Investor Relations for Oil States. begin. may you Patricia,

Patricia Gil

Good XXXX welcome earnings Victoria. fourth Oil quarter and conference morning you, to and States’ Thank call.

Oil Executive Our by call and States' Lloyd we Chief Cragg, by Financial Executive Cindy led Vice Hajdik, Officer; Oil Taylor, Oil are and today States' President Officer; will Chief States' Executive be Vice Chris Operations. President joined and President

historical the begin, information, SEC such extent are that the caution I statements. the turn law. listeners we in over affect weighed regarding the will disclosed information to we to other should including call note we contain please factors like than our Cindy. that relying business that other safe To many risks accorded those the would XX-K remarks harbor filings. Any our Form today Before remarks by in now context be forward-looking our on protection federal of with along

Cindy Taylor

call all Thank you comments XXXX, this December to the you, We’ve provide and us quarter of conference incredibly and earnings quarter had XXXX Patricia. joining months for call. an thank quarter Oil active for Good we our guidance, occurred States. XXXX. at our XX, review XXXX couple discuss fourth morning plan results of On details of events also but fourth to will first that of for here you to today subsequent

a by sequential Our fourth line driven on from operating basis our nicely XXXX segment. both quarter improved results growth top of

to will more of Tax fourth adjusting which the sequentially significant for impact after quarter one U.S. also related items, earnings Lloyd most detail. discuss grew which Our time of reform in share per the

the Downhole quarter-over-quarter Site segment, products picked our ratio completion results product from E&P higher product sale on completion in services our combines our EBITDA able Products and January trend Their completion growth existing well acquisition increased solutions. XXXX be quarter, Collectively, Well benefitting times. be reported should GEODynamics be other remained product December margin averaged for and development that consumable growth more the our with them their solutions their markets Oil and operators offerings brings collaborative footprint. product expand our by offerings pipeline the increasingly accordingly customized growing completion further completion. to customers assisting will will relationships forward. we robust offer XX, their with closed initiatives in GEODynamics date to technology backed States consumable with of with geographic to complex will enhancement using Downhole augment potential efforts up and lead innovation [Indiscernible]. offers our technology X% research the Technologies starting operations that results GEODynamics product meaningful Despite company better and with product while complex a our design. and while revenue short sequentially full Services of the will both a improved With reported continuing driven higher acquisition Downhole in sales strengthening and The we and land third in year as of completions segments project bookings segment the first absolute the a X.XX services which nicely as EBITDA segment percentage. In In of with related lower announced sales from we strong. reduced Offshore/Manufactured cycle of connector Our for activity U.S. named increased quarter strong XXXX. book-to-bill sequentially,

revolving details provide position. facility credit Lloyd through by of I results segment structure and of utilized we consolidated further will and with releases, provide notes our the highlights also recent portion cash revolving more details borrowings the for GEODynamics financial comment described fund more on provide the senior a our outlook. our of market facility We acquisition. and extended under and of credit our you take amount million will to our press issued additional to company. financing longer-term in principle initially As amended $XXX convertible follow our

Lloyd Hajdik

Cindy good Thanks everyone. and morning

million recently of share, quarter which while $X.XX costs one an reporting charge or per resulting U.S. During the million from the reform $X.XX $XXX per related per income of tax due legislation adjusted fourth $X.X generated loss share non-cash and in for excluded net share transaction we revenues $X.XX tax time to our the enacted

We generated EBITA fourth quarter flow operations fourth adjusted of million $XX.X cash margin invested was totaled adjusted quarter our and $XX in from capital during $XX Our expenditures. EBITA the and million X%. million

in million in and and XXXX, the we free XXXX fund XX. which range We $XX expected growth. December which to facility debt fourth at upon made GEODynamics $XX of all investments the after [Ph] our that pay down cash our our to capital of revolving Having GEODynamics remaining outstanding estimate a invested expenditures utilized outstanding position of strong CapEx flow us cash will very be under acquisition. quarter is CapEx million credit year full facility to we the $XX made million For between under our credit amounts revolving portion put inclusive that

approximately issuance of payable and valued and the acquisition January of year consideration For the fund were down utilized of million credit net sellers X.XX of credit completed January acquisition a drawn notes $XXX offering in of repayments million we from based of closed due of required, was X.X% acquisition promissory of facility, shares at Cindy the on of of as proceeds which of we the outstanding of Oil $XX million million further net offering commitments approximately pay maturity generated was our cash XXXX. XX, amended XXXX, to which revolving the maturity total conjunction note $XXX and a stock free senior of share to with amount convertible funded $XX under for under portion to with This the in million common extended. cash the total issuance a million the credit principal XX, of XXXX. borrowings. M&A for the is January million date portion GEODynamics $XX State’s flow the on revolving Lender our revolving the acquisition. for of previously at notes, convertible facility share XX, $XX revolving closing million. amended credit to we unsecured cash, $XXX extended issuance the million million And of was and cash million the activities, $XX $XXX January combination facility price the On GEODynamics. for In $XXX facility of senior total now mentioned our We date net borrowings repurchases utilizing full

XXXX guidance, to we depreciation are to million little a purchase of and quarter of million. a assets. first refining DD&A our intangible relates as to total we in amortization expect bit $XX expense amortizable range of as consolidated terms our for price In giving it for $XX process allocation GEODynamics I’m a particularly

Longer-term total of issue $X net you’d must XXXX. not amortization expect projected to U.S. $X in corporate senior as benefit the notes tax or Corporate costs. losses total the of expense interest first operations XX% in a approximately which million, loss million expense expense to with is should largely benefits move rate $XX.X lower the expect of accretion pre-tax expected non-deductible and our We quarter, to record in quarter to we towards by expected operating income benefit expect the words, non-cash tax million. is other be book includes do offset projected The items expenses tax profitability. debt with of be U.S. offset. associated convertible no to return We

the our call keep Cindy initially time, will items a you range. of the effective non-deductible will details over the back for each higher to this At However to rate segments. like who business turn take in our through I’d

Cindy Taylor

of EBITDA XX% in the but the which our severance our XX% the comment for totalling active the X% increase and revenue well well, we segment end adjusted across number and increase rig midcontinent during the the business jobs other were sequential the by million a improved count you, and Completion basins, international term at U.S. guidance Mexico of of exceeded of intensity X% Services benefited job totalling well completion in our from averaged our completion land $XX well million X% per services performed $XX sequentially up and driven Despite activity and generated in the and improved on following of particularly another result. Thank Permian average increase with The site for utilization which coupled completed downsizing drilled in In the explains U.S. the Completion sequentially improvement high Lloyd. steady with adjusted and Gulf results services quarter range. quarter Services quarter. quarter-over-quarter flat-to-down fourth segment, In drilling rigs segment EBITDA increased charges. revenues basin

XXXX. project million A margin million the largely tightening. ratio shorter between activities equipment fourth XX% XXXX a our XX% as sequential range XX%. to an Well south remains our the our will XX% awards The in projects times steady [Ph] the price year EBITDA improve the were no should to is completion drilling into expected to moderate for million, and which during quarter we averaged for see major printed margin weather quarter XXXX book-to-bill fourth backlog Offshore/Manufactured XX% for portion exploratory sales or EBITDA year. driven sequential was couple X.XX $XXX Completion product, which services segment complex standard estimate of and U.S. generated resulting comprise bid be of were impacted beginning for quarter land deferred declined quarter, incremental quarter of of well with States a based activity adjusted in X.XX million quarter which our the fourth $XX quarterly at margins increases XX. segment negatively is U.S revenue. tied increase million $XXX during our Oil of December extreme totalled of our sequentially our and cycle Site activity, and slipped that We full EBITDA Services year. the Completion the $XX the of Backlog book demand first by Orders later Our XX% for to connector averaged the by are segment in incremental we fourth increase development our and of times XX% $XX XX%. disappointing revenues to driven and of the until segment There continue by to an job. revenues quarter in our Product on $XX growth. and In EBITDA in is full were booked of adjusted of by percentage while into personnel million are for and adjusted Services predominantly revenue segment’s product, land-based Accordingly, a in fourth total XXXX activities

or decrease at cranes see should expect associated near and top is before we is additional revenues given We standard expected shorter Improved in land expected level XX% expected in pipeline in and related project range used U.S. are $XX to million strong customer our near-term. to $XXX continue of segment by selected XX%. XXXX. dialogue million very to revenues for margins will quarter-to-quarter expected products vary product, sale retrieve project backlog to sanctions believe believes our product and connector in driven average and field customers major our project sequentially needed major on for this EBITDA to the outlook and spending timing due Accordingly and our bookings project us a while production to for FIBs that our infrastructure. recovery equipment XXXX. with are Demand be to remain award cycle are in Major completions to the between activity to with be

of lateral great completion and their well improved and will preparation activity downhole the products. created frac and Technology of unconventional Longer forward. completion advancement techniques segment are strong technology acquisition consumable adoption demand more providing stages Our our modern productivity. clusters newly are driving report with going GEODynamics customers the for links

we estimate $XX States with will GEODynamics portion Completions year of of first and market, Services continued demand we results productive million of We range that activity key a manufactured XX, acquisitions To quarter Having will EBITDA of to are up our completed seeing pick the recent XX%. margins that date our growth for cycle the million $XX for conclude, own revenues XXXX. a products. GEODynamics clothing, a be XX% short our which Completion strategic initiative, the U.S. January between for acquisition will we but Well Oil XXXX XXXX ongoing the our results improvement operations of by on averaging GEODynamics support which in bolstered well and sets beginning in more

and our acquisition questions prepared key we open the That a can this completes such completed you to comments. and Victoria, technology call offering forward have look customers. to to excited are at We would our make expanded time. that now the answers available for

Operator

our Marshall first comes [Operator James. Instructions]. like And ahead. Raymond from question go it looks Adkins Please from

Marshall Adkins

completions Cindy, we morning margins everyone. more than were your Good up lot in were a thinking.

You there was to up obviously continued was -- but control cost more it mix much there, were seems retire, quarter-to-quarter? was margins mentioned pricing that part of like why it what’s what, so

Cindy Taylor

tools obviously, both what activities, the about [Indiscernible] weighted but did it a wireline of higher our we Really, talked are importantly pressure in towards is, which getting we makeshift we benefit our isolation seeing see equipment. more

mix would job the to job cost the actually we had it’s one-off terms basis, the During in to quarter, and saw well. but course impact on we I the larger a although pricing in of in due sure of hard know focus I’m as good quarter controls much attribute quarter you some,

elements all for pretty some combined those strong think just incremental. I

Marshall Adkins

labor we’ve without are hearing about at an for much you, people, disruption? are this too or -- that Labor, some issues been through becoming it working you with you impediment stage is

Cindy Taylor

Well we horrific only an and we high in a important impact XXXX such had downcycle year, really frustrating didn’t that. to where XXXX; and a XXXX early very better equivalent an with hired. issue I question, in we say we Without in that we to had need. more number been the say the priority experience last have on on exercise little the field. but around of are would everybody. had in a almost customers part the workers We has we our they obviously focused was turnover not would adequate right it hiring amount very that people, are latter some had a through have I that we support it’s We’ve our for it headcount done field. the entering I which of would

on hands another element we recognize kind on to field have wages issue wages successful relates that raised generally it the is customers, think we’ve a I did to cost, been last and and put the priority customers As raised little having pay to be bit of in see do which think top out of and particularly a field in going our they passing concern, of side. year, in experienced have quality high doing line. to complex hope trained to personnel to focus through highly completions. It to the will increases additional us on able the we’re order be a the We pass rig continue cost that for the that on

Marshall Adkins

Thanks. Got it.

Cindy Taylor

Thanks, Marshall.

Operator

Meakim Our ahead. next from question go comes Please Sean from JPMorgan.

Sean Meakim

Hi, morning. Hi, Sean. good

Sean Meakim

do a about on you forward, or the is you you think than change evolving history I the that you can less of how we your we would how have Is you given business segments? for with us the thank incremental to respect rate of bit little rest give obviously information for else guess quarter. some expect GEODynamics, So with what there anything of

Cindy Taylor

audit Oh, for a Monday on Lloyd’s me, their filing we will an results at that used one followed information. holiday, full has XX-K historic week soon X-K as our bit audit We’ll have as is I telling which XX-K the XX-K. excuse they includes geodynamics. you We hopefully of – me. completed be firm end XXXX the this the by give of Yes, at file Monday

XXXX reason to in is to attracted are having XXXX and they comparative I relates were are XXXX. of growth to it thing we part add kind terms going toward continued course relative in information will very in it the you’re as you good look of them high significantly of growth see you help geodynamics. one see will that successful So of going that a to to that in still

CapEx a track help time We their them we expansions to with lot the with Lloyd think have capacity plan do they spent them. of continue terms our guidance and growth you capital to expect gave expansionary I that in total again and strong some of some record. need augment

Sean Meakim

you. Just are isolation? out competing competitive wellhead We’ll guess Got shifting this wait of then. within helpful. about dynamics And around thinking there there. Services numbers for substitutive you, type I very products, that’s any products cycle those Completion Thank

give Just and how year maybe evolving, say mix surprised has versus you within a us ago? sense side you just terms you a in customer of what versus and can would half of in been what your have a behaviour that is a there see you, rental of anything year, the you the today market kind and thought would

Cindy Taylor

we’ve I type often say haven’t that bit sooner than a be if shift seen we a it Like might Permian a later, little have. is and pressure rig because really what competitive me. tools, little toward where so there migration of there’s the isolation wellheads, to it complex the there’s very market here more very anything, particularly bit much isolation just No, But alternatives I’d that can a towards higher if frac a it the course surprising come is moves tools if completions. nothing said, that the are of times anything base we etcetera. be is heads, count seen surprise, when centered,

So anything one an customer little think as and later but the preferences migration what example, hoped. we it than is came are had there if expected a I different

Sean Meakim

much. it got very you great. Okay, Thank

Cindy Taylor

Thanks, Sean.

Operator

go ahead. Our Jud question from Fargo. Bailey next from comes Wells Please

Jud Bailey

to hit be the of and and some year? and of in through you for good book-to-bill, of I the of orders kind and on level half there, out for the maybe just some the of could year first starting terms talk morning. full do you Thanks, year can expectations Question, half we first year, Cindy of thinking can you one, projects of see that think think maybe confidence in products comment you orders offshore above the

Cindy Taylor

believe can. I I the that best Yeah,

last subsea by of comment. in I about of interesting of saw has don’t in say is year were development getting on that think year downturn. dramatically of more hoped smaller backlog roughly XX that. more to of because backlog say mix out calling I project been are was referred projects I we’re and ago about looking the would likelihood want focused what did activities nine book-to-bill was in And waiting materialize PLP, related. FPSOs, that of connectors or of I four, this one exploratory major know forward we less have I XX% went we’re back and revenues, shocking it had one project whether looking to of indicator subsea drilling towards years is times more creates project, project three, is at terms a this of these it's i.e. quarter toward one infrastructure roughly, if the this morning years. I large first OD improvement offshore going forward much conductor You smaller in fourth whole you And six most at more the big course, five QX little in comments, the my only beginning What of were in kind our first backlog in half, we’re major kind significant a were around I to casing couple flipped, had side, so in tiebacks. that to that fact short products Revenue, weighted is uncertainty the and of would me now half. generally XX% at what with even and We an think I’d a months, that a XX% of booking was looked and business quarter. changed anything more for where that a cycle. point a have the would not production changed and our our lot just time back point million, in used or has that if through the in we

in out but backlog decade a from an not and and major now as kind our I it in near at the upside at business term return other So and in product the I the business different, production some wish of think alarmed to I’ll for by degree short here. my is focused services of on cycle and FID at it that infrastructure were low, look project I’m of as more look I

Our through incredibly team good an costs exceedingly deepwater difficult think in has project. market margins an done job I for managing and

like don’t of short downside kind don't I much I there also services, content our while backlog. think some from towards terms production outside there’s infrastructure. of So of major is because our here of results, weighting other my in the cycle

Jud Bailey

the you Okay. that TLP like the make bigger talking up just answer correctly, of make I I so its sounds follow contemplating the first of any about could want mentioned, to that, not just you’re sure if sure items it items, the on interpret some type other of production in type half, correctly? award the from And I book-to-bill I SPAR, for or more you the of hear to some you’re

Cynthia Taylor

exactly, right. prepared that’s Yes. comment. had our That’s And we in what

Jud Bailey

Yes.

the to quick question for with margin Okay. for that gave of for I could And they you that a they any company, late ask for does what decline the got we’re sequential seasonality just a it GEODynamics like time today in XXXX a margin with your consistent know have month Cindy, and then XQ, You are Is working with services? margins. type margin account some the that for are best got guidance on estimates business? we seasonality contemplated completion and if the

yet. upping We’re not those margins

I do think imprudent so. it would to be

So point we’re this as in of an the time. indicator history just using future at

Jud Bailey

Thank great. Okay, you.

Operator

our And Please Loop ahead. from go question Gengaro Capital. comes from next Stephen

Stephen Gengaro

Thanks. Good morning.

would on and then there? about I impacted services you’re want on you’re and how what maybe you we issues, back bit a first little seeing think the it core? following from It you sounds Based some to incremental's a color getting XQX going in more up when quarter’s normalized like price, about up asked, little Jud got assume, well mentioned I you extreme – acceleration think expect little that to yes. and obviously, weather. seems get on the a Following an But second site what on would

Cynthia Taylor

in planning first expected despite that days growth me good maybe incremental as I and and in in cost Well, think flow quite Texas, both Northeast your have along grow and those question, they’ll that asking New to I’m Mexico, expect just all to but you think for probably in it, area activity margin. to going of extreme sequential into that of you’re kind are to the of didn’t I of going region, we Rockies but et ebb weather in still the I incrementals the we frankly, this Okalahoma, expect have exceedingly and really so way. them missing XX% we’re moderate cetera, strong accelerate. kind sometimes our more having QX despite and sequential given I box and XX% don’t view some the going range,

Stephen Gengaro

normalized into You quarter I quarter I went to you’d the that of thinking a beyond second level, as terms really in guess, know go is you the better it? was back was more way say fourth strong. obviously really, to a

Cynthia Taylor

and Well, XX% activity going need so, that be that that and to to XX% I’m probably call. to we’re guided We pricing tell band to you move so XX% is guidance. early year had to think I its out last little of generally make top by our incrementals and if on just that we’d achieved

Stephen Gengaro

Thank Okay. you.

Cynthia Taylor

Thanks, Steven.

Operator

ahead. go Our Blake comes Weil. Howard next question from from Please Hutchinson

Blake Hutchinson

morning. Good

Cynthia Taylor

Blake. morning, Good

Blake Hutchinson

what so in what you becomes bit and terms business is that see offshore you output. get from a the of commentary little the understanding Just order far more flow

also more I delivery kind Is guess influence a level on be – prudent there what say periods that’s did so of high all be first just that deliveries some represent we’re the I for where getting quarter your of think of You get point, you what just a would kind there would some undue quarter of the putting that the sporadic. guide? business I’m baseline first high is saying sees deliveries project

Cynthia Taylor

we I'm QX me what shipments in a more These what or of booking had it our side, every be not I'm large connectors. that getting have let lumpier in are to connector just conductor your everything elaborate terms question, of the quarter, we both you revenue. little in OD things of not on – tends sure so and terms month, had but

guidance normalized about, of So a point in level. little think forecast be timing those backlog you bit The Nothing huge orders we consequent to a bookings I project and half. there gave more into back can call the what because is FIDs, The has no concern the QX connectors. second coming those guidance exceeded we gave QX be largely until to major connector little is the we can the lumpy. suggested likely for guidance

Blake Hutchinson

flatter Gulf That’s exactly I the or or need what services, that kind the thinking just Mexico as comment as offer for. resistance and sorry I potential was looking just does if portions I we to missed that do of start it in of completion we terms of the guess a of there reset regarding you potential make And growth international well? be benefit then, can year, profile of

Cynthia Taylor

but about of, going where she here, in positive rigs, hard you’re on say think to time she Do the looks any more be some the flattish is might but steady from the ramp as a and thing but some think its were there’s get those Now, so goes here. you in Blake, my of of that rigs a about anybody to projects on don’t kind there its just you that a ebb point flow, International that Mexico, good is Gulf like I at can so cite. timing goes of probably depending on working issues that few significant but can big equipments in inflection the getting early that. way look have to either, XXXX be grounding as projecting best would one feel for steady I from kind would I at knowledge, that going Gulf

Blake Hutchinson

turn That looking back. what’s Thanks. it for. I I’ll was

Cynthia Taylor

Thanks Blake.

Operator

And next ahead. O'Leary question our Tudor, from from Pickering. George comes Please go

George O'Leary

morning, Good Cindy. Good morning guys.

Cynthia Taylor

George. Hi,

George O'Leary

One the as progressed through XXXX. you guess, I guys GEODynamics side,

the side, he downhole area will Which it is the it business, now of which side. you Looking that demand preparation tool business? our and it see I is down sub-segments the guess well-design how hole kind do biggest do to be plug and effect as ramp are that changing in tools going customer we progress three you at frac on think their of year, how

Cynthia Taylor

XXXX, speaking their they growth just expansionary writing Is would completion is core of capital. have I that I What they looking growth Well, had almost and at. maybe their significant learned of the in cite well as in because outsider some products solutions he equipment there, and engineering generally do equivalent. as we’re need

and that going that’s incremental capacity ramp on and their quickly, years. the to core cost some probably their We on in their going jump revenues We’re to throughout products. bring EBITDA to

One we’ll love to trials. help they about that a they to we market the growth that needs products get products that the results are is you depending core based potential issues to and their progress customers completion responsive feel those seeing apprised attentive field outside that few field trials upon that and the obviously upon quite are there their is and as the just and and they that that data field of product seeing of things of of those customers under keep address and they're design for the acceptance our issues their more them we so development

George O'Leary

that in weather for services completions oriented then any are And completion impacts you've helpful. business? cited mostly QX Very hitting there weather that the that are given and some businesses impact

Cynthia Taylor

don’t that impact a be because would impacts, think so and could any yes. direct the answer there from there in manufacturing activities customer there’s significant anything a of perspective. the But we weather field, indirect no, be really to That’s

George O'Leary

Okay. I’ll turn back over.

Cynthia Taylor

George. Thanks

Operator

comes question [Indiscernible]. from Our next ahead. go Please

Unidentified Analyst

for you for thank and morning taking Good taking question. my Hey.

do guess, guess question about in from like weather how you first on think quarter? weather, you last the impact I Just, the have on

Cynthia Taylor

five of – we that. range our Well, in maybe think the something probably I like comment four to days

So we’re questions, those like do kind QX. catch-up the it we’ve feel activity, a is is kind quarter despite could shape had in it in better so the and reality days. in of if improvement been to pushed you totality we have it to But lost sequential much of obviously that I how that got or the of decent

Unidentified Analyst

it. Got

what it terms like you to product and is growth fair about pricing can seems comment think already pricing you’re think for if in line I products that seeing completions? with GEODynamics on getting If growth, Okay. line topline for you’re of your GEODynamics in it completions

Cynthia Taylor

personnel think is a We ask that site, actually count, a a isolation we not you think tools, used frac great necessarily testing, our Well, appreciate completion rig count rig there, at but but et well well count as that equipment is equipment count, it. question because services the support got heads, flowback well that generally equipment, driver. about and as wireline well driver cetera, we’ve

barriers we things, the about of of attractiveness GEODynamics that entry really lift. again that One the it outside in to have of volumetric the the fact they technology love is

but about you latter well stages you count, cluster count. the multiple more than quite then that really individual has. tied that the well services being the to that you multiple and you If you’ll better get business opportunity length, think an growth is, of number multiple completion frankly Again exponential a

Unidentified Analyst

it. Got

Okay.

the if the about in think segment three I and like will Okay. And offshore about that business. think different you subset if segment

down Your sure driven the of can lines, year-over-year, but so business? to I’m path good. not do? driven comment be you its that it product And how short year-over-year, should you on should about I pretty said backlog products the projects more if would XX% cycle three it obviously other is think NAM, think that follow it, how pieces normally you by Generally call

Cynthia Taylor

to everyday, at kind fact XXXX just as the do have we outlook uplift a and XXXX, have We compared evident about more but exposure in product category. our positive XXXX the services you base my think have services, of go is bit in shift again to that comment XX% that the XXXX fact other we think so see major downturn in, been well particularly for the becoming work. that positive activity. an to have contribution in Services, cycle kind we we and product XX% because look I land have other that of mix been for short goes that to cycle bookings pretty we presentation QX and you has positive very our feel that expand the range many generally a of products, through went little Services seeing to and we compensate as short to around of project more products have what in major we’re and can other when outlook and investor segment years a backlog XX% study services, which short we so and about cycles over but only into have little for the us many and in we of

contributors margins I The is and help keep will half-full, if generally a turn. other acceptable you're short always my as cycle that revenues our am, down are margin through service this high and levels glass that think I thing at good

Unidentified Analyst

I my all had. questions, Thank for Okay, taking that’s you again.

Cindy Taylor

you. Thank

Operator

comes SunTrust Please from Our go Robinson. next ahead. from Sill Ken question

Kenneth Sill

good Yeah morning.

Cindy Taylor

Ken. morning, Good

Kenneth Sill

Yeah, GEODynamics else will I’m used it to here, going got something but to time up follow on help. to – a get the have calling

to XX% have you you clearly days So, going had QX than in more in are QX.

so the the and would line assuming about that maybe best all of So it and that, goes follows because footage rig count you up that rig now. of count and rig rig I’m right be is are by of completion, the looking base twice wells then per I’m revenues, as kind the per growth completions at going way talking for

see of double QX? low So to of something high to revenue is outside this could you XX% growth sequential adding of where digit days kind single just

Cindy Taylor

that continue I looking go we know extended revenue planning when driver significant you the read continue are right line back quite either, been and EBITDA on well strong and extended -- so expectations them the in but out we you top not and that key and driver now don’t time. growth, – been growth and continued performance the ridiculous and at at margins significant look about growth as would EBITDA XXXX. the this in there count very the today incremental don’t the to cluster with their see outside rig that, it that’s responds if stages for kind get was we of XXXX Yeah, market in to about it’s want growth X-K point the And or year-over-year there has I you again, are trend count the well as obviously, count, if of laterals, at mean very

Kenneth Sill

to it kind expect of that still responds a rate I clusters growth get increase XX% slow side was you to consistent? – the count take pretty know up guess has I up then if mean down or maybe seen you are plus oil stages gross I fact change can in and rig do is some clusters, I now, you – another you I then X% kind take can going been and is could numbers of price frotty the it lot seeing and QX the Yes higher stages or and the to of or I is that the on question are slowing in pretty you XX%

Cindy Taylor

change We hard change, in today, to of we we and don’t to the but come you at if typical to that of but out well the it’s any mitigant. at has Permian look rate reversing feel – trend, say see a right XXXX rate been change that

laterals rate three but about a probably modern from generally So not excited change, a that but still move so say out positive that think trend level it’s was the positive to get two to [Indiscernible] miles I environment, bit. it’s I just of miles would going incredibly too

Kenneth Sill

for to Okay, seeing thank well you. those guys. We’ll financials the look forward

Cindy Taylor

Ken. you Good talking to

Operator

ahead. Levi And from next our Morgan Igor from Please comes Stanley. go

Igor Levi

morning. Good

Cindy Taylor

Good morning.

Igor Levi

talked hoping trend was the have bit XXXX? higher lines in think a and about you been product some towards to So so about end you equipment, talk the seen that winners of the I most traction going not previously

Cindy Taylor

about completion thinking you Are services.

Igor Levi

completion a In services. Yes.

Cindy Taylor

Yes.

on isolation support proprietary in what saw hiring we that’s think higher mentioned and QX. our migration specially we more I equipment, was what towards which our tools, pressure while

an mind you and will and manifolds tool it's given good very It demand our branded a I about these share zipper example be on. laterals does market very that’s enjoy as were would clearly particularly that extended technologies in Now and effective Tempress.

I for a be, So those of course work do expect that focus well. would areas kind extend facts but to us of as I think term near

Igor Levi

this cash remember now was, the there that prior the you quarter, drove in but I be a drilling what margin revenue in increase thought one? then they I some And had the more Great. segment. headwind will are of mobe

Cindy Taylor

actually margin QX. no hit normal a of you back mobe think that down would probably cost Therefore again more revenue, margins on QX typical mobe QX But again. writing without go side have kind you impact had revenue no a No to obviously helped, a would a margin. you you it so revenue then X% on X% if We at quarter at more that more in gives either. out of to QX, -- you QX some that given a factor of compare X% normal cost out had normalized surprises the and

Igor Levi

actual still rigs? a high, wondering so was the increase I And conventional Right. in number total for land is an pricing new there

Cindy Taylor

and What really. new of a we and more We are customer we days and consistency for place. new Not six we looking home get operation. seven well need to stability can is to week results optimize in a from job, drill down well it’s that job pretty customer and going to can hard to your predictability customer well, you’re environment. we efficient. in week be much to to up more When If

Igor Levi

I’ll helpful. it That’s Great. turn back.

Cindy Taylor

Thanks.

Operator

no this further There time. at questions are

Cindy Taylor

I all busy, busy else today. to pretty financings. joined and acquisitions call Thanks an great. season hectic if our of earnings who Okay, everybody incredibly kept been not we ourselves with and you it’s know and

post get model to excited talking projections company. XXXX, incremental it some great you So earnings, we margins. you made we us as talk our appreciate about added that looking to our and but GEODynamics were needed. you. will all very that follow the to for, gives said acquisition be information we’ll we to to our the so much investors the Have the the to accreted day, more we do It and the time technology effort scale are transaction we the help We Again, gaining long as importantly for to out strong company offer guys us Thank soon. think be our changes to scale accreted that the about that forward to customers, company. look transformational our to a had we gets you and

Operator

todays’ concludes This gentlemen. call. and ladies you Thank

now disconnect. may You

Oil States International (OIS) 15 Feb 182017 Q4 Earnings call transcript