OIS - Earnings call transcript Q3 2020 | Oil States International, Inc.

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Operator

Welcome to the Oil States International Third Quarter 2020 Earnings Conference Call. My name is Adrian, and I'll be your operator for today's call. [Operator Instructions] I will now turn the call over to Ellen Pennington.

You may begin.

Ellen Pennington

Thank you, Adrian. to third welcome conference XXXX and call. morning, Oil quarter States' earnings Good

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

of forward-looking would information, begin, caution to we A the along turn relying please the the note we webcast call factors of call our this statements statements. the that contain information harbor the will with hours month. listeners can remarks so remarks these X.X risks will safe and call the business, be one on afforded SEC affect after assume that quarter the law. that replay disclosed to our filings. by be Before Cindy. completion today accessed forward-looking should other call for over I in To such valid like website. is should No those we remain will States' or protections This regarding federal conference at Form weighed context Oil Any extent in being and than available historical are of many later available including the other that be XX-K beyond. be now in our

Cindy Taylor

participate Thank to third our in conference to for of each Good XXXX joining you, quarter morning Ellen. us you, and today call. you earnings thank

improving as we entered off quarter prices witnessed call, low second on believe US with stabilizing we As at quarter. the our second levels quarter, horrendous crude the activity, we earnings historic in shale that discussed levels the was third oil driven while

several momentum began COVID quarter cases to as increase jurisdictions. in Some of the early stalled

talks trade $XX latter steadily stimulus of Crude market in frac third update completions our a of of much and the around As to sequentially half per XX% down on market prices term to the both US-led the capital base declined improved, to the began terms up the now on thoughts efforts in early with to near and oil but stages average quarter trends Washington. our to spread of recovery. in a early a off count. our taken our ending barrel quarter, quarter a for summarize around and result, plan the shore low albeit quarter, stabilized operating you actions conditions in liquidity, quarter, tend conjunction you and third US In as give navigate mitigate of COVID-XX costs the discussion we we the

in revenues, delays to guidance our other forecast quarter offshore were with third were in and results our manufacture of able activity customer a internal orders. which generally line and our timing limited previous guidance below provide were Our that product we than to due

totaled sequentially, revenues EBITDA Site $XXX recovered weaker revenues in and sales. margins Segment up and quarter, EBITDA our During XXXX decrease X% connector sequentially. improved. the segment, September quarter our at Downhole Technology sequentially, primarily margins X% offshore Services were exiting In backlog Well XX% product products with and the due million, XX% third contrast, segment decreased In positive territory. to up were revenues XX, manufacture also a of our sequentially,

ratio totaling industry-leading sequentially third to an $XX times. yielding for what X.X be million, increased of bookings segment appears book-to-bill quarter Our the

cash debt our the be flow of end, operations, we delevered more flow we generating manage the segment. that position To business, and consolidated each cash before believe quarter, that and fixed we our closely Lloyd management During in on our and during the results capital materially will $XX immediate operations our to and in a liquidity variable by preservation of effectively company very $XX difficult that financial generation continue cash period had our of an of know and net to in quarters of detail, to total review our periods discussion stress significant have million. free from go the We with million of will exceptional flow I a the focus the debt, we come. reducing managed needs during now quarter working cost. into

Lloyd Hajdik

morning, you, Thank Cindy. good And everyone.

During share. the a we $XXX of of net third $X.XX $XX or generated million, loss quarter revenues while reporting million per

But measures X% cost implemented. revenues significantly sequentially. Our EBITDA to savings improved decreased due our

Our third quarter and in ended million. territory, totaled EBITDA positive $X.X

significant generated flow operations, with quarter we million mentioned, the Cindy expenditures. during offset $XX from in flow in $X capital free cash As by cash million

quarter, our $X and convertible to value, We deleveraging thereby repaid cash sheet. idle principal outstanding in during notes senior $XX credit sold million and equipment generating We proceeds. at million million the par borrowings, purchased facility partially $XX in property revolving a discount balance our the of also amount XX%

our was amended interest million For the $X.X non-cash, discount, At XX, which our the our third totaled $XXX based facility. was quarter, in net and million book ratio to net costs. our liquidity XX%. debt upon of outlined million, credit totaled of capitalization September expense $X.X issue debt amortization methodology And debt

the declined million the credit the totaled million facility, purchases and At XX, under our notes $XXX a third of which our Our on and debt million. capital, obligations, to $XX net the portion working senior outstanding lease net compared excluding of repayment current facility. during totaled and $XX borrowings revolving the convertible borrowings total of credit revolving September quarter, cash outstanding inclusive debt

XXXX expenses consolidated In we expense over terms and to interest total I'd expect this net million you business expect XXXX our non-cash of time, environment, XXXX, we $X.X $X.X million, to amortization million and projected to call total million, quarter corporate million. results guidance, of are $X.X which XX% from At each CapEx approximately levels. depreciation expense of fourth the total in back our our this to $XX segments. $XX is total spending In which to through invest the Cindy, is during take turn will approximately like who down for operating over

Cindy Taylor

was of our EBIDA of in EBITDA and segment generated to quarter with during achieved Thank to $X sales. segment margin offshore million the quarter. primarily slowdown XXXX, $XX Lloyd. XX% - in sequentially, XX% million increased compared third quarter. our second line XX% In connector Revenues guidance, in in you, our a the manufacture third product segment revenues the we product EBITDA of due

As times. I totaled in earlier, million. orders our mentioned booked book-to the backlog million, increased September quarter $XX ratio quarterly third X.X a XX, $XXX with totaling of sequentially bill At

to XX% a energy and diverse quarter, the going years by completion times project more which significant we in due energy services Mexico third XXXX, Gulf our book-to-bill led XX subsea was of [ph] leverage us business develop developments highly and Recent segment sequential delays and activity EBITDA. manufacture the environments. activity has globally, of subsea in the the be or over should technologies, to forward. fixed quarter and we production award Gulf, do our for which floating potential International deepwater, of systems, For generated In number help bidding are In to The later the expertise leading-edge product in customers Site third with on opportunities third revenues, US working $XX land breakeven due offshore XXXX lower required offshore contributions military, and of was support wind base activity named higher. us increase for shut revenues endeavored well drilling, specific X.X Well X% storm mining partially expect quarter cultivating bookings while million driven better near will sequentially down our to comprised product Services in. average support revenue our our we of lower capabilities in segment by offset our timing. while the ratio completion market year clients XXXX, than levels that to and storms achieved Gulf activity technical, of Mexico segment, and

global We support are profitable our base. streamlining and on our pursuing and customer activity operations focused of

core loss of areas quarter. States this we improved segment the Technology We due cost will recognized at increase Incremental to and business. implemented developing actively sequentially much measures our strong savings margins third new completions In with segment, of the expertise EBITDA are differentiate in to smaller proprietary segment field revenue XX%, were a to EBITDA and offerings a focus level. continue Oil segment, and in conducting service trials Downhole of on

to trial continue products switches gaining addressable new their Downhole for trends commercialize customer are our Sales commercialization. the segment. in and systems STRATX, following Technology and acceptance the We develop integrated gun old improved VaporGun and respective

the technology. of We tool of ancillary have commercialization wireline perforating also and charge new shaped announced new including two release a families products,

markets. wireline efforts continue development activity and with highest them with we ensuring and the are in hamper domestic international in while where performance, and flexibility, mind, product improved our level reliability. and E&P functionality safety to increased disruptions strive designed of provide to Our COVID-XX customers

industry count In XXXX spread sequential the quarter was XX% was count. down third frac The US rigs, us experienced an rig XXX in decrease average sequentially. XX% which the average contrast,

However, light shale which activity cycle exposure. with the short driven our US quarter, segments improve did impacted favorably all third in of

per favorably increased seem Activity As some the frac $X signs been spreads shale oil to we a US in our to of range with outlook are is that market more gives the carb downturn. show around the per front fourth about driven mmBtu. and increase for a the optimism has the of in basins is Its shale are month by gas mid-September. the $XX quarter historically first it's count in XX% improvement barrel, now end and Crude the some the there also offerings. quarter, spread XX up into decline But roughly the to has setting service since first US bound be prices recovery. product natural near fourth us

our levels. with fourth margins between current $XX to EBITDA our range and average market and quarter segment project absorption million XX% trends, to $XX XX% we manufacture depending offshore product upon million, to service along and with product mix, expected revenues segment Given

sequentially spread the downtime, Site not and we improvements frac segments Technology in expect our which produce positive weeks, is count results holiday we currently the Given and Services grow last fourth witness Well in EBITDA extended Downhole to quarter several unless the expected. over

costs cost the XX% XX% and the over included with CapEx spending reduced As we direct a reminder, in declines, been activity by have following, operating or has has year-over-year, reduced have reduction reduced planned reduced discretionary our since headcount approximately year, been line substantially initiatives of have eliminated. been the beginning

we sold call, costs second XXXX to on relates estimated conference and approximately the total earnings that we cost of As our the SG&A. reduce of XX% is by discussed would $XXX roughly we million, remainder quarter goods

XX% are nature. believe cost We to continue XX% reductions that of to the fixed in

Fortunately, materially significance reductions activity should declines not of we such additional be that necessary. has believe slowed

progress strong exceptionally with third have with our like quarter concluding believe in debt I'd liquidity cash reduction initiatives. terms associated offer of generation, made substantial we We comments. free Now coupled some that shoring up flow to

that demands customer we with correspondingly continue time, business working questions during began meet a harsh from product come. comments. technology believe we this That effects And services. the Site COVID-XX to you on at travel to we cash our for which reduced globally, period. earlier, products completes manage difficult have Adrian, stabilized we and our activity, remain our lines As demand safe pandemic and call will thereby answers our the would response, up depressing and prepared continue quarters services in to and and the flow open and mentioned as recover demand please? of for value-added generation products dramatically I and leadership to in providing will operations, the oil to company conduct global very debt, Well focused the we'll capital

Operator

Instructions] question comes Thank JPMorgan. Meakim And first from you. Sean from [Operator our

Your open. is line

Sean Meakim

good Thank you. morning. Hey,

Cindy Taylor

morning, Good Sean.

Sean Meakim

you to, where should Cindy, But down clear I this looking as that's comments, you that in mean, stand in do obviously prepare a you always at a lot note a or XX% stage, progress more the there of be much call in that more today, until be on it's of So sheet, four from doing next, macro back to kind been balance With more. focus is Lloyd, year. out to the can perspective. a to give done yourself And that it I macro volume? like most what fair quarters you. position sheet we've the seems the probably weighted [ph] on balance you a six of It me like waiting to beyond to assessment? said, needs done you Is to comes

Cindy Taylor

it's clean as have Lloyd Sean. flow write-offs. here. working free on many spend, cash I'll had activity Cindy, our and through. need CapEx as keys of terms to that in both environment, this are some we've we laser-focus of now acute going very receivables flow declared by from this declines, we and think to continue term, quite improvement. through the think But heavily, that to point, focus have. continue at that manage and drive heavily degree an your generation Hi, for downturn focus, if evidenced EBITDA have the of in will, managing I But course, customers will you We're to say this to to of know, in but we've you let cash probably I we me the the bankruptcies, significant And to operations a despite are had see frankly. well I'll terms - capital had set point, been needs challenged that, as and really had receivable elaborate near

levers the initiatives cost realization [ph] will course in of that the Additional place. put of we

dealing favorable, of the at and on alleviate benefits give cautious at going Lloyd you'll QX associated far in color this or still again, caution led is, while and lot math, think the with, it's But if COVID-XX answer to I'm more going that that. profitable cost we're slightly those is into - initiatives. capital. Downhole again, see I a my demand Go from you And efforts not and our Site light really destruction working sometimes breakeven additional Well environment of that operation. US is EBITDA. the ahead. these the But But to we're XXXX. more look if Services you looking here With reduction outlook below incremental, you i.e., into guidance will,

Lloyd Hajdik

be you very some capital pretty time we've the would fourth with months. Yeah, manageable. to benefited I quarter. if nine build say they to mean, know, out are exactly would But XXXX or [ph] that for I she's Expect look working you working so Sean, flat right. capital. first harvested many And probably in improvement some

obviously are credit our steps with facility. looking Next at banks working on the

the goes end through of amendment We that the March. have

professed like We in new the an know on facility XXXX. look our credit the the till levels maturity facility today. is post-March, and what amendment with not on date the to is down debt outstanding but you $XX million credit we're comfortable So or would positive that February - pretty revolver the paid nearest converts

with very undrawn put the levels, essentially facility could we that new facility. place So revolver. all and the or, and credit amendment time By we're then all, in in existing on a the our be leverage the comfortable expires, credit

Sean Meakim

That's right.

we've detail. course. That's the probably book-to-bill, that's really, manufacturing Maybe I also a offshore helpful. of pretty seen all the products, really not in I quarter. the group function appreciate think on the good that's the just this best denominator, of numerator,

an And your peers brutal results orders know, so from perspective. you have pretty

focused orders, order the more some And Cindy, inflection a see on least your we'll near 'XX. bottoming for going maybe feel for and and do some I the about offshore seem forward, And to on? term, good you helpful. around contracts things good the those real even around would think you'd other of maybe traditional the be for be outside end, hear even maybe great thoughts helpful. isn't gas and then you've your little Energy how a at a Obviously, horizon? New military even any in just a be Just on and around quarter, optimism, related, that fourth cadence recap love about to oil they'll areas get customers, opportunities, had

Cindy Taylor

back, course that know, you I critically the this this bit we a our has speaking, alike Well, ratio. say, at the more characterize helped in But our would that's if diversified if is that product offerings, pretty space, trends, could and between you in one point book-to-bill one offering have no same time. step there's what a product do. we and look generally as comment, to fantastic of many And, I important us that competitors experienced of

diversification is by better, Now, an no that part you a But year, whatever historically is example, an are an core on as base environment. that gas. potential But did know, in factor of I question, us, at, orders we the of think mining. math look floating of our if offshore which And platform we're project industry experts. if driven in are of draconian are relatively here. helps. announced bookings in But others in we these production riser a for I [ph] indicative that the And around order are that R&D the that outside customer is the denominator we think look I QX and back have. our military oil it's you we're And very more we experts, have both subsea you and fixed think experts,

are So that's mining the if in or rare which XX% are both of this while long shift it's I earth say potential screen. really But is well, answer to and radar the can other early of bookings that's Brazil. in in we're projects are oriented a But mining, bit foundation the wind ground, alternatives QX, to the in say, of projects, to When greater rest to subsea a bidding also into a industry, which you on on mining the [indiscernible] look consider long any driven you QX towards, - towards always probably side don't And to on the subsea they the other what's you going to good and projects relative we mine alternative in try going our that you're going surprisingly either radar mining to now XXXX. sources, of minerals, that us, actively that why conversations range nature. number subsea of the term. that. have have regions, side. China sense of our or towards space case, which, give and and I these be we bookings out still come core, and the which maybe of for know optimism is going for screen, subsea more the they look in to hedge on beneficial and to those in not offshore. most And on But very one We over

in and of and large gas, second another in it We which oil also quarter, announced to the project, Gulf was core Mexico. project happened be the

the beginning outstanding capital long relative time. on markets So an basis, delays expect that, base and it this, focus there's And customer will but capital the what over by always we're and our opportunities bookings. is, prioritization they this like and recover seen and their term. In to it's is over for see we've a to of this us award still business region's

Sean Meakim

Thanks, was Cindy. helpful. really That

Cindy Taylor

Thanks, Sean.

Operator

question next our And comes Stephen from Stifel. from Gengaro

is line open. Your

Stephen Gengaro

and morning. good Thanks

Cindy Taylor

Hi, Stephen.

Stephen Gengaro

So I two things. guess

Just a a one, from bit I balance perspective. talked know little sheet And this. about you

parameters the we about depends that at and about that know a the it of sort be is little anything driving I free capital? on should kind flow, we next cash working but think is look XX are bit different of revenue Lloyd you As you considering And the should how growth, expectations into like a working for year? there months of be that free cash thinking from capital next

Lloyd Hajdik

more increase there's know, in we'll have if increases the operation results, No, recent not Stephen you today, receivables. in

I that's cycle. capital So short very kind working very, moderate, that and traditional a call of it build its

as it well. pretty turns So quickly

of liquidity So time. cash significant it's case not one a in or of period any

Stephen Gengaro

what relationships? US about as probably more And about seen you the the on responses consolidation particularly think past but consolidation think do impact the should Okay, on you? think you second, you've we from of service different thanks. how And in How your you that companies, positioning, varying E&P customer on land in the then based as well? I've side, sort about gotten market, see as

Cindy Taylor

of wisdom that that very get and rarely significant, like go past have lot widely And maybe the when a two I returns through of industry consolidation two, the exposure stronger. company Permian always for reflect invested you that obviously, on different, have the are they look together, number the these put companies we there's companies sum been consolidation, majors of the in capital. if know, the you made, large in years, the strengthen because forward. would lower are awesome say that announcements do think I lesser that say, you to that, conventional strengthen is activity. the getting very we to of XX. of - to heavily. and exposure a this obviously, are you a before, announcements obviously, acknowledges it's And strong These There Well, of to type particularly basins the on been need have really gaining didn't as

likely into there's And so these reallocation a our presence areas of a companies operating didn't thinking these of some really strong today where to have before. is that be capital

released a But even are that a be also whether capital this stage, investment I announced so think do one's think or at different. flat do a type they bit allocation. is not I its And but no growing, this closed net-net spending And that plans acknowledge profile that of I yet. these deals, negative might their or hadn't

If look we and has the your it's good you going at think what I XX is forward. you that set come agree to specific talking to opportunity down combinations allocate opportunities some lower but going capital, about, the choose all where we're to do

Stephen Gengaro

you. and about one, And incremental cost we margin initiatives one about that that think we potential, gone about out if and think the think just thank have and then when you Great, is, final any and margin relative bumpy. figure we But history seen months quarters capabilities in of be XX can when the because side? can be specific cost change to on out what over we've segments incremental your any

Cindy Taylor

of to performance is positive what EBITDA even the are we it's our am which an growth initiatives. now, incrementals, small not to because to Well, means deliver though you or been US probably where EBITDA is that indications focus I counts. think we're greater businesses uplift revenues, masked and saw centric the either activity than mean, that's cost even QX, hard losses I flat I is I instance evidenced by in in frac obviously But an don't as that's you gains, of sustainable. spread [ph] know going towards go shock able of back on to but seeing because in we've reduced But you. to it, XXX% going right some

top As strong we should incremental get those historical be actually trends. growth, line relative to

bit and exceeded pressure there's as out the this the line have on point I always say, cost pressure to caution well. But I think programs at significant top been time. have Now pricing the in a

Stephen Gengaro

the color. for you thank Great,

Cindy Taylor

talking and to good you. Dave, Thanks,

Stephen Gengaro

Thanks.

Operator

comes our from Hallead question Kurt next RBC. from And

Kurt Hallead

Hey, Can me good morning. you hear okay?

Cindy Taylor

Oh, think talked over yeah, about I that. we sorry other, each

Kurt Hallead

thanks, all Cindy, incremental thanks for color. Lloyd, the

might Technology and So well charges. acceptance some you for vapor. just did about Downhole as the touch on side, that talked customer And STRATX [indiscernible] reference some opportunities on

So that acceptance, - I you're that if a you we traction be how might And more. wonder us of you that just help should us understand kind to bit delve getting? the little able into what how categorize for customer or could

Cindy Taylor

I'd that they introduced will. light offerings to sequentially because early share just growth XXXX, quarter were gun have, know, the XXXX, and our we field industry with when to integrated trials the our be we offerings, you recall, we particularly we really if in first happy integrated being gaining that you call, believe that were revenue actually in of we compared metrics, commented had

where with so we the to was hit falling share, again, shutdown were and gaining in absolute you then it QX knife. horrendous in a of thought an And get face catching activity we have COVID, levels

of is share. don't market you really can QX think So I QX indicative at or look

integrated - as to are sensitive. to active, and in and the shift is lot just going saw fact, trying very standard included prices - incredibly price Just an with because we'll very, offering. call over conventional to of liquidation guns, market to but what modestly trying remain of a low time, customers our say at QX

switches, But And you'll create some quarter during inventory, this holding offering you're anything And to so just flows. shift conditions are else, for from working some either that that down from those market get saw away is did this competitors back no the can customers they and find. ties our that I actually the to the others that I out what space no and hearing are we to think QX the actually their charges, margins. notice, capital the wrote losses of cash liquidated we as other if from the inventory, to inventory thing generally space. cheapest inventory, in a own in extent integrated want to And you

was, in is it bright indicative being QX, or not liquidated The items a customer that predicated of STRATX in us, a the we lot both orders more very specifically marketplace. offer believe been conversations, those shift and and for is towards of of conventional future. integrated we VaporGun in lit so this that's a going products offering, fact, on to market, handful of have the that again, side and that QX And the is, partially to the are back

guns So QX. terms just expect unequivocally share. I say I'll share, market made to more in market did just of of stabilization in really But than measure generally I we integrated market the little QX even in a can say I to sell

Kurt Hallead

That's or all things a know, are fairly some integrated that specific the customer stand is there getting respect the your make kind of to feedback one offering, the gun the say specific with are you you vapor STRATX color. mean, few of metrics, competition? I know, to What the a great really Okay. or from out? you comparable? Or relative

Cindy Taylor

and improve integrated it that to historical highly can't will. really that effect or do that we relations, relationships again wireline system, those two is STRATX highly or for that generally, customer the of have But that the want includes offering, if two to to different I - our process. partners, will, But system may reliable be to et a offering you the thought customer if existing And giving time. quite cold and with we frankly, will every for which market in ideally extent other again, a desire, month. VaporGun, really with that Well, types. offerings reliability geo importantly, was that each they're our that the over short we're cetera. designed a again, charges, company it was consideration, integrated, inventory, it's different improve our we the you pay developed highly wireline It you trend switches, the type do really

And offerings there. very that so will are out best it the be I integrated with competitive think

Kurt Hallead

then, to Okay, that's to would some you know, - you continue pretty And into expect debt net overall you great. and XXXX. be going imagine debt have flow reduction. significant even positive, cash I pretty free

primary cash forward geared say going is of So - the to towards still going be the debt just reduction? is use

Lloyd Hajdik

allocation Yes, Correct. yes, capital Kurt. purposes, for

Kurt Hallead

think And you the general you year? the into next by that magnitude reduce other of what could

Lloyd Hajdik

- process 'XX, level going of upon budget now again, in on. EBITDA just really we're it the Yeah, depends through our which

So stay tuned.

Kurt Hallead

fair Okay, enough. Thank you.

Cindy Taylor

Thank you, Kurt.

Operator

Ian Simmons. Macpherson question And from from our next comes

open. is line Your

Ian Macpherson is

the Cindy, deleveraging, Lloyd, congratulations Back to in horrible such year it an upstream and a you right, and what the for cap but that's scale, in need better earlier, been consolidation, equivalent question impulses context. really on as well. real the you've a the redefined for impulse under smaller. consolidation for the different Good market is market general service, details Thanks. you service are this morning, for absorption sweeping scaled The accomplished know, impressive have

you So what Or applies don't you the there's have thoughts you And Oil corporate do? transacting any are like? that consolidation that M&A so, do in to And might it as if on in States? What know, a need for your look specifically interest and? everywhere.

Cindy Taylor

very your in of know been I've well; this long you need with do scale. absolutely and You very know, a think I landscape I for terms competitive time. know me the business I agree well. comments

exposure ago. that technology is years transaction the the dice as that was that [ph] of and know, You quite one couple Jio a well reasons did while and as frankly, we incredible offered

companies. that conventional in of ourselves capital sheet” many to of open of time and companies, many And that way to there what to environment until right And sheet, really are companies are what's overcome. to our levels your and fine, others, and most to transaction is do do shareholders. on a that And the “balance I I find eyes trading to it's the that nobody for past still that. it's where if ears think you is and And outlook wants which sadly, debt, allocate said all get say do see have an problematic to our right so balance the for trade situations for the means have, fine, being energy continue challenges you so shareholders. to indicative trying open some a are

to sheet that on and any deals companies should be differences assure positive my can are might eager to for necessitate improve And though, and done. this shareholders, the do possibly balance the hard just we call, of so just our to amongst it's get absolutely shareholders that M&A. returns past you to outlook I

until you it's just every more it month. sheet Its obvious you so week, simple think have at that any every prepare. balance do look period the maybe We of I answer. Lloyd, every set see I comments? opportunity a delayed comment. time view day, an incremental

Lloyd Hajdik

could No, for I just of would say anyway. stock combinations deals kind or at any you're be looking the that

Cindy Taylor

Very to out good Yeah, nonetheless you exactly. got take going debt… comment. It's but be - to

Lloyd Hajdik

That's right…

Cindy Taylor

Okay.

model, more as time today, So as of an we're to this. going have to want on asset-light go asset, continue will really diversification, in to we done nonetheless, and control, we and the we have differentiation, but through past technology, focus

Ian Macpherson is

of one's make their all mean, the cap you course - for year. no And structure have than this better That over the then sense. I redefined

we and is decent better, for for EBITDA higher I LNP, I like you certainly gave Downhole. it have missed activity, specific in - puts both that… but have I a missed fashion sounded better gears, starting it you us but but you guidance the revenues not know, should guess incrementals QX, some customary, block So Unless follow Switching position. it, Well for in positive pretty I might of Site those, may it,

Cindy Taylor

material Yeah, in is you, ready give in that segments, everybody yet. not quarter shut US our say But currently as expecting that any With revenue are revenue years. EBITDA we're sequential we holiday to we percentages, I improvement positive and for QX. specific well if seen improved we've caveat as we through those as downs, did EBITDA in not to what operations. expected be should past that, centric going it'll is But an complain give

Ian Macpherson is

Got much. it. Thanks so

Cindy Taylor

Ian. you, Thank

Operator

Stanley. next And from from our comes Lynagh Morgan question Connor

open. is line Your

Connor Lynagh

is free in flow from was kind this ways. of outlook to just of XXXX the bridge next Could moving big been wondering, think I costs, appreciate you year uses through activity, help but few XXXX, I in Could sort Working tax know, you maybe Capital have like sort like free big on this help would look for pieces the that's a And we've of us very cash different approaching thanks. know, cash flow? restructuring that? what think cash Yeah, year any CapEx you big us the dependent uncertain. a things obviously some sounds been refunds, variable through those you of other of year? how and next the

Cindy Taylor

to that. try I'll do Yeah,

compensation now, positive are liquidations historically are generation. capital quarter traditional thus XXXX in in are headwind has Those that to smaller. first much working this environment, a obviously, The

much we had relative in expect don't in QX we XXXX. to So what

better our the to for short, of this in recovery allocation capital, led it our to on CapEx done that But quite activity it about and I think products, which between the on to it guidance XXXX, CapEx. depending you dependent will where albeit again, we're going at into a the we'll capital, you that, at offshore know, of those but as you has more the goes that. are our comparable give when of you need that visibility, guided not we huge down some know, go segments think to will backlog through means, XXXX, CapEx, very Clearly, upon about timing at liquidation XXXX levels amongst we're takes. unlike expecting if $XX dictate to be help might have. visibility frankly, again, puts are point, our market any will cautious just we than Lloyd going to February be But And upon different, working set you CapEx, I opportunity based million. business the XXXX be allocation And is revenues look that of very, lines. us to we're US you we've end

terms out paid payables That in very squeezing clearly, in liquidation manner. as we've of we've a gone. Just our timely receivable some

working in benefit the been Act create you done Cares transparent and very will. out We've $XX we've of really was the clear documents, that that if to capital, is nothing So payables extended magnitude landscape our million. QX the QX and

had favorable it cash to flow. a So our impact very

sheet. Cares is administration that the But balance Act. the carry to those of previously, ability NOLs. over, more that an back the took our when nothing monetization asset was on limited But Now, obviously, point the they of than

had. asset been all it's in hope an and So an your it's I helped, revenue and questions a said, just it's harsh monetization cost I've declines. I we of answered out have but environment certainly

doors we everybody levels, been COVID been particularly you know not induced XX% is for, of my more back and are lost be off XXXX XX% back, looking keep different industry, XX%, current XX% So attitude I'll that know of I you decline I importantly, think jet fuel to in nearly was if has I news think and know, COVID lot know, watch kind and thought in not obviously, back the still conduct open. - to was back tell included, will.\ today. hit another you horrific And an roughly you lost, decline, of the recovered. cost we if horrific. a tables demand yet big is demand anybody, outlook, we're germs revenues, into know, it again, to us think, of destruction has I've waterfalls, concern, incrementals you, picking day, Because to had never demand improved XX% if also airlines, about didn't life, because demand. you at up of, on how way we've system the it think get I to And the think learned we're look the out we looking and we COVID this therefore, than in to work about And should I your the that my difference you with the this And you today of every be April much the your that as through it's going situation recover my if induced is, informed are need I those daily clearly we a improve May. permanent.

can answer no, we place, here? any gained the the but say, from by worse different to materially means in knowledge has time, one if how I of we're point pandemic, it's while And at our this in to So communities, is minimizing. with I'm it the think helps. not think in get entirety kind that work on I of safely, a a the still

Connor Lynagh

much particular an But, are that there's broaden have presence new I domestically lines, statement. your that a Help international lot you prior mean, kind sort within business, addressable of pivot you've I about. in there. of about more insightful a do know, expand of question. are occurs of think market? America, know, thing you in a not obviously your your that any your stay know, interesting of particularly opportunities focused. sort opportunities some areas context me, services you others is it complete versus got to you lines Any But excess Yeah. energies the This product see think is would core to an reach? some Do and context? to But product just you capacity of, there to are North if you talk of which but

Cindy Taylor

in mean, I and scale. global scope are we sure, For

countries, our that One times, different Middle but operate various Site personnel of of However, course, segment, find penetration I reach, expand XX time try in and to think that is better growth and over technology offering we customer also manufacture group again, base. have, broadest at our product we we of and meet for say that in on I'd a But say customers. offshore technology to exposure the Middle Well in the Services equipment our our active East. it's it rotational demands And the and of more that has path still on I upgrading focus initiatives. our two with basin will And our the particular And and it's is greater our basis, concentration us long an to more I nature. a East. that's service focus with grow the some just in area continue term to needs global unique but a still probably

Connor Lynagh

it. Thanks much. Got very

Cindy Taylor

you. Thank

Operator

And the next from Stephen Gengaro comes Stifel. question from

Your line is open.

Stephen Gengaro

Thanks.

like sets of out it the year? follow well it's Do business piece offshore - it, plays on next have driven quick Just up. you a that it year. seems how project up based comment the side products of backlog, reasonably manufacture offshore a next products, - for The

Cindy Taylor

lift our this we're Well, come which to booked in year, next from lot to little I a terms again, year awards, bookings this more diversified, a year. big of a military mean, little likely do. I less a book has more military we've

award again unique bidding the Our thoughts in on move of some then globe, do Brazil that bid concentration that not there's as and quoting regions. we augment activity opportunities bidding bookings focused opportunities awards But both the and go quoting the type delays cause wind. facility QX and the very into some infrastructure, and subsea much with as with forward obviously think for subsea we've of that the and we Guiana, and and I of bread the subsea production and butter done, across mining XXXX surprisingly, is leg in around us are more a XXXX. elsewhere There's infrastructure our next

Stephen Gengaro

Great. Thank you.

Cindy Taylor

Thanks, Stephen.

Operator

turn final I'll questions. And have we back further no for remarks. call the

Cindy Taylor

forward week also and Adrian. know market earnings of for I you. to alternatives have in I quarter this terms appreciate look time Lloyd time. in I with are connection in thanks up your available you, of for it's in a to And always company again, and our a you all spend to follow in February. Thank to of you how if you And the needed. crowded terms your difficult And know follow fourth such in you continuing we talking Thank support.

Operator

and today's And you Thank Thank This participation. gentlemen. concludes ladies you conference. now you, may disconnect. for

Oil States International (OIS) 30 Oct 202020 Q3 Earnings call transcript