FI - Earnings call transcript Q2 2018 | Expro Group Holdings N.V.

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Operator

Good morning, and welcome to the Q2 2018 Frank's International N.V. Earnings Conference Call. My name is Michelle, and I will be your operator for today's conference. [Operator Instructions]. Please note that this conference is being recorded. the to turn now would call Mr. over I Holcomb. Blake Sir, you begin. may

Blake Holcomb

earnings. and Michelle. discuss the XXXX Director Good you, and welcome Investor the Blake Relations of morning, quarter to Thank call everyone, to Communications. Holcomb, conference Frank's second I'm International

today Financial are Mike on Officer. Chief President Kearney, Vice Senior call Kyle and Officer; McClure, the President me Chairman, and Joining Executive and Chief

Q&A Russell, Scott Tools that have this Steve on President of the McCurdy, to of also Running posted and of call. A We Services; we'll call. Specialty President Blackhawk join been throughout presentation portion today's Tubular refer has to website our

you'd website If to our at go franksinternational.com. please this to like presentation, of the Investors section view

a on items cover few like to we X. Slide would legal quarter Before our on are begin I beginning commenting second there XXXX results,

to accessed A specified. forward-looking of the and different our included filings, any information risks the is update responsibility assumes at discussion company forward-looking replay statements materially from First, identifying material of important SEC you company Such also company website are in any language speak franksinternational.com. cautionary website included questions or measures now those remarks to SEC's in uses on remarks information. to or the both this comments. of such channel complete any call forth those expressed earnings company's the may refer statements. statements company cause for as of no will statements. over as statements. website to its was the routinely distribution as implied or today. filings, a could today's Investor the by results on in non-GAAP materially is financial GAAP and in as accessible today's access note could from turn of most date any earnings International quarter the actual for subject second or actual that The reconciled financial to and Frank's risks The call if representatives Such and date. different, call. contain which in SEC Please set future posted to uncertainties or cause has which forward-looking more release, the comparable Such to to its this date, that only earlier these a during answers of differ company by answers defined discussed results that XXXX and There, by may issued I may quarter call directly Relations Mike XXXX release second section. be are measure the on his factors

Michael Kearney

We're and pricing also the Mexico East I'm we the early but revenue of is longer the in commenced longer-term International the Blake, saw positioned the Gulf and share Middle Gulf to as The seen contracts second an some been participants quarter dedicated activity for business onshore and up of segment further remained contracts as improvement. and a onshore morning the was the the our contract saw to use some evening as the offshore U.S. in our grew operations, see resilient in was more the of we've as strong U.S. revenue period. and in some Services customers expected XXXX. the and offshore market picked of additional as the increase key in and the this help lines. drivers the increase our in during extended margins. extensions improvement, EBITDA afternoon saw market. have revenue Pacific. Mexico, first Africa during our I new margins. XX% onshore drive good new go Beginning on good The quarter, projects years, serving the in majority and two proud drive signs Asia products very Europe optimistic the our Thank It's quarter a during since quarter, that of of in than the sequential some that sequentially Blackhawk we offshore of U.S. market technology with markets highest well seeing service sequentially In challenging Slide largest X, internationally employees to as up were in of results. revenue good Services second quarter revenue in the Frank's making in to increased adjusted call helping second up Americas, and quarter you, us everyone to rig those and will and and of well over

that hold, In take fact, segment sales beginning this behind highest is family. quarter the International in help the Blackhawk were part the support for QX to the view became particularly this recovery and The since Frank's results positive the is that bottom us internationally. of our

on longer believe call-out This quarterly and work generally the that uniform will be recovery unanticipated than the negative. upward. momentum not work. well as quarter to a on In to as positive We'll than is short-term However, a but in expected We bit can some trajectory - and later. lead scope customer provide variability, QX, its that more basis. saw we some difficult quarterly generally forecast is projects extending more now changes

priorities. do improved near-term we mindset, While parts the to On overall to a our Page working elevate market X, cultivate is and are financial drive can the results, will diligently help performance. beginning you which operational three company's its strategic to see

path we business. continue tubular services First, our the down of running will optimizing

completed serve profitability. geographic deep In customers continues recovery, to second the the quarter, be evaluation well we must and prepared As of we our improve the our dive its our market footprint.

location categorized we process, into categories. this During three our configurations

with which define full-time location operational entity we legal countries, core have and a as we and base First, permanent personnel. a

are will case entity; however, sail investment. out out pieces no and structure This a value have All the that new opportunity afford personnel. of row highest the categories we because no prospects business see to without our what the row certain in prioritizing near-term personnel, Second, over base we as have sail locations classified flex discrete objectives. time prospects remaining or legal or permanent will base they in countries meet adjust is as locations permanent inactive, as to the local the place. develops a of Obviously, to These be. there us meaning no business and we significant pursue optionality and us or opportunities. gives refer also locations in might We're industry our as we

us the all number of most based the or or on now Our provide to pursue on is sale business make segments. team intelligence for as segregating the Frank's we well the services can across of opportunities volume items rig time the that sense as

bear aware of proprietary our the to the Conversely, on make our or Frank's a or opportunities not will every regions of limited Our work are countries. be early people, sure higher construct circumstances, from not that's With expect agile, we specced value they If have as to emphasis opportunities best chances being prospect overarching possible, an possible engage maximize and and can the winning In to more internal our game goal our to identify opportunities all These business. value optimization result bring is we laser portfolio in certainly technologies right seek to success. odds early project initiative we tender. the technology, teams strategic profitability. the and risk to as our customer the of with right are standpoint, the added ensure to an of of high-value teams on provide. are TRS operator The will these will which into decision of maximize with focused pursue of then we we profile. have to opportunities, the

our opportunity We're growth by our Our in done and step high-value by work tools expansion Blackhawk operations. that priority quarters, future growth. the full our international are hand-in-hand manufactured customers of benefits and near-term traction this is improving well-intervention expect overall commercial sales solve The we see technologies for optimization and of second increase coming Frank's new of of continued and the go-to-market improve with customers to business are their and the their on meet further as operations, is their the more spectrum markets. the essential services teams. segment Delivering demand. forward and safety existing the from In increase gaining international the well-construction to challenges this goes our educating next to the finalized high-value the of products represents certifications Blackhawk

progress. specifically, resources, targeting made has of dedicated great have the and these certifications We completion

currently this fourth out to the We tools worldwide market year. tools requirements most have stringent and the customer expect are to of and quarter that rolling certified in are certified newly

to actions necessary to profitability Our final cost the priority near-term reduction is our and goals. complete meet

that, made progress of the the to year. our in gross margin. will targeting to point operating project and on additional year. back I'll over be Kyle? call, on as on combination goals in this financial reduction call discussed we first QX half our the around result XXXX of margin $XX basis the half we completed good G&A results With XXX of XXXX, operational exit and over run-rate we're As turn Kyle we in XX% improvement on two improvement exit improvement a these and million quarter. the the during basis rate a a goals provide accomplishing have progress profitability now the details remaining should of The Through

Kyle McClure

Thanks, Mike.

to near-term International Let's our Europe, quarter share the experienced Adjusted around the International the work driven million. up for from additional the second All can go double-digit was call-out of of or Africa, with quarter. segment, $XX.X results growth quarter. was facing work and quarter as increase ahead offshore million almost to million, Starting on Slide sequentially revenue first international growth $XX in The the which first mix $XX up EBITDA attributed markets X. million during rates the jump which International The with second be by improved Services Latin growth $XX primary driver segment Services and in the XX% picked be robust Canada in to up on America, was quarter. and in was Asia, the increase from continues into the exception gains. services challenges. Services

offshore quarter, XX Frank's increased the rigs. count average rig active During

earnings the leverage offshore You the during international with the experienced business real quarter. see significant of the margin can we and power

X. Slide on Services U.S. to Turning

increased revenue X% over just $XX to million. quarter Second

million, $X rigs on offshore revenues the revenue XX% nearly work of more sequentially. called of rig The we the onshore revenue Second displace EBITDA and second to in market grew share sequentially. overall the a out competitor is to during U.S. customer an call-out onshore X% instances Services increase also to quarter, X%. rising improvement was business Gulf. improved exceeded an $X a The the of U.S. to improved quarter-over-quarter and expectations, working in by up U.S. market. due our growth improvement quarter was compared efficiency rigs in improved The where The offshore several were higher million market Adjusted a and operations. were attributed quarter attributed to for loss pricing, roughly

all is this EBITDA includes cost. total as for Mexico approximately and related well Gulf our cases, U.S. As corporate quarter which our contains of all of activity for the many global support G&A, segment these million $XX functions burdening corporate in a was The as for business reminder, to adjusted domestic million onshore of $X supports which around and overhead.

of first of take our up the most coming was quarter more were International in saw a due segment of to XX% sales, as quarter market. and from last international regions year. XX% deployed revenue dollars we'll moved quarter. offshore the fourth XXXX, quarter revenues results. the market X, sales Slide $XX year-over-year. million, EBITDA four two U.S. consecutive during up seven to product have second from from Total quarter. first There Blackhawk in down have XX% Blackhawk see the as we're and are since U.S. different look countries well increase quarter XXXX driving of this. at although than product geographic were U.S. improvement of up revenue from setting QX Blackhawk total will reasons adjusted onshore during Turning expecting and the XX% By significant in services around record to the the as for were increases a you outside higher the margins Adjusted U.S. the EBITDA the Land higher-margin sequentially, work in

profile. revenue is which mix moving rentals from lower more to the margin product more of and moving sales, First, away has

was sequentially. in markets. Tubular drilling Revenues delivered as expect were future Second, well-campaigning by decrease This X% the Blackhawk XXXX. million international is making significant be and up $X $XXX,XXX, adjusted well the in investments centralized this Sales and Tubular certifications EBITDA down due them changes for quarter. Revenue corporate in with driven picking TRS people a to $XX the million, Sales orders quarter to X. first segment is the as done will in to in in portion in customer was Wrapping up of was on quarter Adjusted do which lower growth second reside for being position second in programs. year from costs, down the EBITDA changes higher lower delayed The volumes due that sequentially in schedules. customer segment. We manufacturing later Slide

not be QX. to likely until However, this recognized revenue was

XXXX year, full revenue segment's the full we would around from this to For up XX% year expect be levels.

work contract was expected up results. starting basis, On and Slide as a were Turning some XX% company-wide combination call-out TRS sequentially. unexpected up the up to XX, quarterly of Global XX% summarized revenues the we as projects experienced financial the Blackhawk new projects the better-than-forecasted EBITDA of for in international particularly call-out our extended work and we sales. higher, and certain starting, segment. Adjusted revenues combination expectations international better-than-expected exceeded being

flow quarter operations Second million cash was but a $XX improvement $X million, negative sequentially. from

capital as business you speed. increase the are needs million. $X quarter seeing CapEx was approximately expect, up the picks for As would we working growth

has CapEx been expected the Some XXXX first in is of half in second of the half XXXX. delayed

of balance see capitalized the is second expect $XX this remain investments million fleet for we well expansion. Blackhawk build to at half and We for be would out we facility million and comments, $XXX some to we and quarter of range third what Full sheet, further rental debt as the on access and my close expected in short-term this CapEx the year in new the tools credit likely to provide liquidity. international million year. on essentially cash increase to drilling is So to of out in give roughly I'll The additional a months. the in coming no expect facility see finalize on in expect To us remainder the $XX color to the year.

but international and we Looking to QX, in decline some segment as and schedules some The offshore an the is at X% should expect business continue down revenue to drive overall fluid to of better completion more QX more their market international to see based will will will growth, segment the forecast. see operators likely onshore revenues customer is call-out on be revised decline slightly it likely of forecast, The X%. level company which to and lower linear. we the and market becoming I offshore, see while Mexico campaigns. will international forward, as Blackhawk going revenue works U.S. focused, total to quarter. expected challenging describe are not lower albeit at is difficult drilling tubular Gulf to be forecasting be rigs in to projects be and also The Services

a incremental favorable the decremental due we Looking in in experienced less saw similarly at as to revenues higher international as we quarter. see margins to the expect QX, in decline adjusted EBITDA we high for margins just mix QX, work

revenues the full that we $XXX EBITDA are of million million the between range. XXXX, year million improving. million to be will will For $XX $XXX the fundamentals $XX be The somewhere adjusted and and market in estimate

to We markets, increased and receptive XX offshore months. are tendering in customers more count the seeing becoming particularly than are upsell previous rig international the technology activity, and

This XXXX. open shop, for is end and Q&A. for to rates the combined that, we more presence offshore that our Blackhawk even the Frank's to even controlling as value As call continue a the optimism trend, business, rig will With will being become us growing proposition costs profitable set gives stronger. stage our international benefit with

Operator

[Operator Instructions].

Hallead comes from Kurt question with RBC. in first the sir, The queue,

Kurt Hallead

see. here game right at the like to in moving is is the guide great where direction. relative along It's favorable well, a to always plan Appreciate pretty Sounds least points as year. looks for street the

to to So, run question you and as able reduction kind Mike, you, a by and achieve the being this million start dynamics for rate into maybe cost continue program $XX year-end. off getting you of emphasize

the process, opportunity be see cost right go than think you greater the is now? might on what do As through the table reductions what you to

Michael Kearney

Well, and in I investment a of year, think with in looking creates year increasing next business obviously, headwind towards achieve to think, first the to it's terms But of all, more of little tough to and of - we'll business next our business. goals. trying be going I cost phase it the you're bit an cut - growing to

something love to in to I but don't dramatically set of that, to So that we are what we I'd targets, optimistic one. got hope. get beyond I've terms but want attitude exceed out a out, can false kind you wait-and-see the of on laid

Kurt Hallead

Okay. follow-up some U.S. of the performance were TRS the in quarter. know been I looking the the there Looks question. to like during as That's had a past course guys made fair you progress enough. Maybe business. on improve Land the

Just wondering the put some if key TRS where might you the longer And if what performance longer are in on in fits strategically of metrics update give term, fit U.S. some in Land does term? business place? you

Michael Kearney

I'll that start And great U.S. have deepwater than The done business, operational job of good margin business. But as business. everyone with less solid to business, nevertheless, it's over of is folks then hand the a a offshore. cycle, knows, it's the and a Steve. it continuing the has that to over increase Land course

well, margins that doesn't So great very still we're like. never It's mean going it exceeding a with a that it. happy business to offshore not deep but have it's we

I'll the one. Steve on what of terms next two, of in pick kind up that we're seeing So in quarter let or

Steve Russell

Yes. Thanks, Mike.

forward the clients in there, QX, been of the share in in publicized some get we around and as we've some Land the market driving of midterm, U.S. pricing also Obviously, performance. our the cut U.S. the in on keeping but with managed Permian U.S. the that, generally where Land, is several So can. we is here execution here going? somewhat. where And larger Land around going leverage in look we helps is what's push continuing which we're to focus world to margin question and midterm what's which gained So our that's eye during pricing the

Operator

comes Pickering, in with Byron Holt. Pope question next Tudor, the The queue from

Byron Pope

to been to wanted as It historically heard has long-term I I just market, bit potential on little contracts Mexico although Gulf seems the commentary. probe though opportunities. think or market that call-out of some a I've but a

guys So deepwater just just there, how the given Gulf? positioned clarification are well in some you

Steve Russell

Yes.

here. So, from Russell a Steve speak I'll TRS perspective.

some to had competitor QX we where in a So replaced gains large operator a Gulf. during we issues service the for

we've seen So via some contracts. share long-term Traditionally, market that quite gains. is market

there the is So what we've looking is clients pretty out that look our to Gulf of at into - Obviously, we will as at Mexico. for several activity moment we contracts out, the still their looking for of much out actually half for and XXXX got drive have looking XXXX, there very most years looks. budget on are the where further solid

Byron Pope

And I of some well particularly seems If on the a levered are though activity to region. then Latin it recall the question guys America as second you offshore just correctly, Guyana. occurring

that, activity, on are well TRS guys So as that there is are continue we the fair well to they construction it reasonable to QX incremental see positioned contributed think to think side? and that to you

Steve Russell

absolutely lot specifically, you QX Yes, Guyana, there. are driven of correct correct. by A was

Operator

with Sean Meakim comes next The from question JPMorgan.

Sean Meakim

little some Guyana of that highlighted, just characterize the call-out out And understand up, your 'XX? us starting are a little how cross pick some that it'll case as of timing work, about more there for if just important be that a going maybe mix. helpful some the for you that's you geography a half one. base you but up other bit better of be project of puts more the variability, and informing takes to an pointed the customer-type kind those to to wrapping then of thinking there's project being and cadence granularity could are maybe granularity get we Could So kind second of

Steve Russell

Yes.

Okay.

robust. was of call-out rigs too on of visibility is the scale Middle quite guidance the and as and dropping handful off was you work got TRS We a just why of that in lot much pick for Pacific - also of But of in kick visibility. which activity. contract, think a which the East, Asia not a we We a tend QX increased QX going got down. which large some short-term look Norway, in to hammering a sort QX I and projects wider up beyond, QX into with be forward in more contract during fairly internationally, saw So operator we've some will we've be

Kyle McClure

down, out forecast velocity for What I'm online going Kyle. don't how of is comeback, kind of projecting to will. the were that as down, is think this how business it's as at really I say, things the Well, things coming it's us bad good we're you it's of on Sean, I this to think there, way the coming come and difficult if

at of we in we guide guys see of out as quarter, You you landed. pars something for kind down this QX where as

call is is we're see is through of have out, pricing that it's this this fall won but just some work we some to starting online. and to the uplift some now of starting So

Sean Meakim

was that it, detail. very Got helpful

we've times Could quarters, of of were maybe for us have out around a of you where you up you give versus could tendering a out be over you there defending for where somewhere the sense multi-rig certainly Could opportunity think when the calls mix? that sense may us in opportunities where tenders you piece of what to several significant next see maybe fits terms see share? that picking a in into larger the and share quite you share. bit I pretty So larger were some there related, give a market there was kind guess, talked previous fight tough,

Steve Russell

moderate the Brazil seeing table I X moderate the for scopes XXXX, to which have And gain. of share longer an and up, say, work, we starts potential or picking position we're X see Yes. a think lot into some that here fairly in at becomes is the activity down of market wells. come in where Africa still of for end there's moment the going opportunity would the generally, a we handful to up for at I of as tenders for term rigs some us. opportunity pick us fairly and that expect the 'XX across have

Kyle McClure

prepared opportunity talking on-base about this really Mike team each important baseball commercial and - winning. high-value Yes, that the in need you to is use There about and part as think XX to his to come year the was and the XX XX down on have you commentary, percentage. we the of about pipe as is to focus be part of get

You bit need little higher. to a be

need You got of get think sort I to is focused a going good to more and not often on be more got [indiscernible] we've so doing here the base [indiscernible], Definitely, on much process really that. so team forward. we've

Operator

from Wicklund next Jim Crédit comes Suisse. from The question

James Wicklund

Good those. job. doing to In We more surprise. we've work. love Nice previous jack-up talked Frank's calls, transition about

talk how bit of was splashed and better. which seen high-end was You shorter jack-up about business? pickup penetration me we've what of best note frankly market think you about gone Can cycle work, couple over clearly you your East makes little has talk market that the in quarters? is past a today your It a jack-ups Can the the us jack-ups. Middle part the into is

Steve Russell

individual The Dhabi. - number vendor and had distributed vendors some we've would getting contracts typically Saudi then to work, over I say, East a in the there Middle rigs of are are Arabia on in in issued improvement Abu network. of specifically, terms that distributed across Yes. or in

we're fairly sector some on So the offshore see we've North additional We've starting in improvement also say, Sea. I'd done of some the had to success well the rigs, some U.K. jack-ups. getting jack-ups. in

Kyle McClure

just we have months up on Jim, say here market. XX% global our the in Yes, jack-up so me the to share market a from let share XX last standpoint, taken market global from XX%

James Wicklund

That's metric. by successful anybody's effort

'XX Okay, you the you what's 'XX interesting everybody That's the in interesting. trajectory think which And and the bottom, is of deepwater that's pickup deepwater of cases. that a improve? of late 'XX in XXXX notice see note more in contract 'XX. than but is to us typically me makes expects to later the probably in see visibility slow starting from was of guys one to market uptake? to 'XX you really points QX Do more in starts Is you Norway 'XX, minor? about the 'XX, West slow Or going the oil in a that see the Can is it a typically to it quarter that you way? sound all most Africa, field rest helpful. But we and to be that - and lot 'XX talk on

Michael Kearney

Yes.

I think say, could that's I to predict at certainty. if course, safe with but great ranch of be the Jim, retired counts I'd rig a

at be ranch too. You'd your

I for in predict think can't that to going are they commodity be of to are and be become to start operators a less a but So it's I I the it's to - claim or in is we're the hard to little be more fronts confident tone prices out. that, out, the they - that years as couple drives all confidence macroeconomist, And of we but level, commodity convinced a of think the more of overall - range more profitability operators. of And gets seeing more course, the market course, the off on then kind I they think, can a - level first stabilized. price the are all of it and offshore then feel a further all, going of the

money to $XX, from reduce managed barrel, to can the get for spread. on good in price news. they targets, This going prices a breakeven driven isn't got operators big That's healthy and offshore that make commodity we've $XX they've - think have that based a But they the sustained the $XX all a a by dramatically convinced everyone. to new or be their where profit they've nice we're speeches operators standardization $XX barrel offshore. You've their heard if $XX we

I for So our X think buying next business that'll the into scenario X that's the bode and we're to over years. kind of well

look all environment. all but could we a good the be in course, stable sustained wrong, signals pretty going it to more be Of - that back we're look

Operator

next from in queue with Simmons. The MacPherson comes the Ian question

Ian MacPherson

levers Guyana late Mexico the We've You've actor. been obviously, improvement exploration back a Gulf and customers with one seen or are much situations. the of market? bit success the like internal in recovery we work we wait-and-see your Mexico think of the has with of the out do done year still lot next to commodities. surprisingly getting look talking as Would been flatness But in to given share. me a a that, And the deepwater the think more Are Gulf Sea basins year? in so next created and, Gulf changes surprising you that has North other has market you about that's special constructively where

Michael Kearney

to I'll hearing of the mean, I not turn I'm Steve. terms in of major euphoria Gulf Mexico. any over

new or You and have about read pieces operators bits place. that funds extending

So see I don't seeing? I forward upward rapidly. Steve, or and but hearing any what see some mild leap you are optimism,

Steve Russell

Yes.

think, for see it's I a wait and XXXX.

have second comment 'XX further through I got their fairly on clients we and that. 'XX budget of outlook go can think for short the for the before solid we've to in the a term, cycles really half

Ian MacPherson

generation. your otherwise, your And drag based for was cash for I is appears a working Got free a you ask half. half. there of the cash other in And on a outlook updated if capital curious my It's free question, in flow the target about guidance, been I it. could bit just if then place first here second wonder for

Kyle McClure

you've We've free half probably we've standpoint, We'll did at on will cash negative think working outages back In standpoint. in $XX term, the begin that probably so in capital that CapEx got get business I think but add likely year, in get some $XX figure. from cash a upon million from be just of internal a year EBITDA, for But in of the in free pretty with and from into flow up will we're million from projections. looking year areas. in catch QX range those a near in think, a that It flow the to based to quarter-end adjusted the QX more half profitable good million I we QX. the as a standpoint, we're I our going a point got DSO. the back fundamental obviously had XX-day this $XX a

cash grow given almost a that kicked to is all we as as getting well. next quarter, of in quarter So

$XXX investments. today with of short-term cash we and So sit I think here million

think, that as I the slightly be And 'XX at as profitability think here like growth the bit half assess year back little up of what probably it the in first see I as to well down from some then the again, of the year. and the half. end capital is the working will side, we'll of looks overdone rates, on we'll in look we and catch but a

Operator

Next question the Gibney in queue with Joe Capital from One. comes

Joseph Gibney

question Blackhawk. Just a on

the getting target the mix XX% a by international You of sort referenced of end year. of

international some kind growth. has incremental getting but sort then it definitely deployed? of in Just a XQ? Just of, curious now target And year in it a Was to and are been is, where been of of certainly trying you of Blackhawk. know we inflection higher. internationally about understand stands mix tools it has and the Norway certified seven target, sort particular step of of your a where of, in there kind different talked big XX% and I terms some exiting kind one countries there

Michael Kearney

you're if chime on in. you can the Scott, phone,

Scott McCurdy

Yes.

it's a of answer think to have the broad. ramp I your very up course over we of seen the going To one year. be questions,

rest in half quarter, that average the X year. we XX%, seven and Right second now, about first we markets, active much mentioned The over quarter. year, XX%, of like XX we're but had different ramping in is ordered that do the was the see half and the its Latin back more America, have - we Asia, and up of Caribbean. Middle the work in countries work the of countries about visibility think Europe, already major We in East, over second Kyle

And so spread the getting which to to our name of good broadly and pretty tools customers outside we're U.S. be is out our out, it's going as exposed getting our

Joseph Gibney

Kyle. for follow-up Okay. Helpful. just then a And

was need want your Blackhawk for the sequential guide. the I could just seeing Just I clarify? the on if clarify you commentary U.S. to wasn't what for Kyle any clarify. third you're don't I on XQ sure comment, to tubular. on what in quarter, international intimation to

Kyle McClure

that up be, likely there I would think the segments we see slightly. commentary

Land. and see the I in think onshore about increase as as will the house quarter see we'll up will We we some see U.S. through Steve right now side on Gulf talked slightly that of as of the continued growth price Mexico come be well.

So and surprised I'd the relates presently in cautiously relates it heading as QX overall and tell to shakes as think, continued to that you, international space I how forward. that We out. more growth Q-to-Q QX optimistic segment, obviously, the been and it were, has

Operator

Global. next in with comes queue Seaport Mike The question from Urban the

Michael Urban

internally, Or review you confirm Presumably complete of $XX sight have target and is that, restructuring review the line just there completed you you opportunities - you've now on if been that what the essentially you you've - identified presumably kind completed done regarding I'm you said So and were that have the quarter, undertaking. on kind assuming of improvement. about having XXX% million the you business of that incremental your initially? that's XX% there? that Last of had is thinking of

Kyle McClure

what's countries be There's real got is registration, keep. couple Kyle. need of down countries team people in after prepared of there shut branch entity grown and world review. books what's going that statutory of and that a core a from to are mentioned Mike's or This anymore. we've too dive, and no ride sort We've got legal deep real still going on the of number ride a footprint into around in, that on. the of was just Over of activity No we've commentary that out, and many a initiatives of kind different the one Yes. Mike obviously, did time,

going going capture initiative that got on, you've which So something. is to

we team, the talked from high-value work winning which piece the got You've want we of which opportunity is about, which to is a win, that.

on all cost not side either. the So this

So well. need capture in markets certain we've to as pricing we got

totally still I time. we've this got I And think point On side, in front. that on we've to think at do identified, what execute the G&A not call largely that I got some work more

Michael Urban

Okay, got you.

date of you where to If exit target, how you relative are? you million say terms $XX realized in quantify you've to had the much would to

Michael Kearney

obviously, we're to kind the the a for in year XX-plus percent. of quarter, at margins, gross up In target

itself, sort mean items here getting business need we're overall have items the some doesn't done. G&A traction we just an I time. execution that probably through some in least the mean, we're half which this front, growth way X/X - But X/X by of in at on you through through at point tell We upon reviews done half way from reviews, department on the and to we've So or better the standpoint. is about has additional work still that we're some - gone by I'd we've say front. done. way of sort and I'd I piece of detail through internal through that improvement on to department you X/X gross margin the X/X that G&A internally based piece, tell on

in So point this in what's tell more probably of you XX% been at in I'm terms I range. time, executed the

Operator

[Operator in UBS. Instructions]. Sanwal the from Sasha from And the next comes queue question

Madhav Sanwal

key And of rig picking pickup on equipment on deepwater offshore offshore is you Just TRS, have your in that rig, TRS. know see activation. the driver we slight starting the to we're once

We're on equipment working rig how customers talk doing much and thus for versus the last, of your offshore it and the kind IOC how E&P involved So is about advantage are? the having driller that? was the contract of reactivated when rig,

Michael Kearney

Yes.

at in market. can seen TRS rig. technology sell-outs large stretching to into of It's traditionally are clients. tendering We've in contractors XXXX. on work So tendering activity that were we seeing the important moment be various execute improve the to and - for margins and into The an operations drilling comes not out that peak and stretching increase activity you From 'XX majority very, there, subcontracting win the pricing. in from very

rig particular essentially, meaning have we the to if a drop. stickiness up to on to structured and ability on that would as there's pick our previously, our were equipment. change also equipment competitors our we support Some But rig rigs

Madhav Sanwal

your great. are so, undergoing landscape When Okay, follow-up on seen bidding or whether recent just pricing thoughts there I current guess, a just level, are you've market Sean's question a bundling? And It's and it's are high on activity, very Maybe to share. can competitors comment at helpful. you competitive in transformation? major if any there? changes in any give us changes your And on

Michael Kearney

take it Yes. could be how on can't the it's When flat pricing. we but is tender it's that into of evaluate course, that all, existing slightly do. go depending Hopefully, customer. competitors to profitable the so, where we first of we a an if generally what to business situation, we down predict Well, circumstances. and do If up, need

is quote. say and can seek hope financially business fair that I competitors disciplined all a get they all the - we So to on are that we return

that? Steve, all So and for you have of share any we don't hope get further the I is, rational say business. we'll thoughts fair competitors our can know, I on if

Steve Russell

Yes.

think, the by seen in offshore pricing and forces market very regional much for still market. It's the I desires local point local markets in and moment. inflection competitive driven on generally, at we've an shares market, in but

Operator

at We no questions time. further this have

to over Mike call the for turn will I So Kearney final remarks.

Michael Kearney

results. Thanks, your QX everyone, for pleased the with We're questions.

in $XXX year $XX revenue as see a in in of of to [indiscernible] to a the do QX $XXX based on in primarily. $XX We is in expect a million decline QX to adjusted a in full mentioned range drilling revenue pickup more However, schedules million know we our QX EBITDA slight from should million EBITDA. into we company customer's a and on million efficiency revenues still and profitability your our there and bit more financial footprint our strong the operational International. we're Recent to Frank's in our sustain for with downturn. optimism as broader emerge back a that improve optimized and market global need better performance product time and have growth and a following Thank interest a balance trends sheet. offering, way the the to reinforced to you

Operator

Thank gentlemen. and you teleconference. for This you, today's concludes Thank ladies participating.

may disconnect. You now

Expro (XPRO) 8 Aug 182018 Q2 Earnings call transcript