WFTLF - Earnings call transcript Q1 2021 | Weatherford International plc

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Weatherford International First Quarter 2021 Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation there will be an opportunity to ask questions. [Operator Instruction] As a reminder, this event is being recorded. to Relations conference and like Topiwala, to now Investor Director, M&A. would turn over the Mohammed I Sir, you may begin.

Mohammed Topiwala

CEO Girish Welcome, everyone, call. President Vice by conference CFO. quarter first Jennings, and President Saligram, and to the I'm Weatherford joined International and Executive Keith XXXX today

today prepared will it then open remarks, we start We for questions. and will up with our

to cause to any actual many some site forward-looking You today's call with risks refer and today's slides and that uncertainties herein. Investor risk expressed section. filings forward-looking to that statements may Relations to from regarding correspond could factors materially statements. download Commission that latest a cautions are Securities copy of remind I our Exchange include statements. differ comments subject want Please our our of presentation results Web everyone expectation for the These from and

include comments release, to our a to With like of turn GAAP and today measures. our that, Girish. over Web Our the quarter details measures in also The found to underlying I'd on reconciliation can included be first financial non-GAAP non-GAAP site. financial call are which press

Girish Saligram

quarter first the view some start then all Mohammed, I'd XXXX. quarter to Thanks, the updates quarter, on highlights up with the today and it second first follow to financials on our from the call directional with the you joining and the for like market. some full would today. year and for thanking Keith the on for details views

will our update direction. on XXXX wrap imperatives with strategic I up an Finally, and commentary our

losing the oriented quarter carrying commoditized we our on basis delivered February was America our year safety slightly industry we geographies. several very despite service product out We expectations that which growth drilling Revenue XXXX. outlined proud for never on into into a X% another of X% more and in diversified focus performance, of today lines with keeping came XXXX down a forward call And We on from as will internationally. operating while players, start sequential three, larger having We saw with I'm lays are quality. decline favorable North and in exited Slide the by good team and with momentum priorities. very above pace offset on

performance EBITDA XX%, However, cash outstanding, with being our cash margins. strong was balance significantly, quarter was fifth million of cash billion, this again XX to with $XX consecutive generating at the flow, a up Most the of sequentially. led in which company free performance million double-digit $X.X

we shares recently the announced company SEC we that of on we WFRD. As aware, NASDAQ to registration symbol you're the our the and filed under all intend the ticker with relist the

to we efficiency. work recognize that bring optimal to While have do an we operating to company the still

this make and board, efforts and partners, in patience, the this We right change. milestone. support thank in would like to time this believe customers and future reaching shareholders their important to are confident I the is our team, for

recognition from to area with receive customers. we specific Slide multiple the to first I'd on Moving start continue quarter safety, four. an where like to for

operations over historical a Excellence exemplified intensity are For our of Tengiz, the running the profile of which in the has historical TRS and greater had several We received Award safety risk digitalize product operations. operationally the of customer and tubular line, now opportunities. high which outstanding successes stickiness values efforts commercially and personnel meaningful quarter, both given at that reduced example, are the IOC. for the at potentially rig create site expansion manual core exposure to transformation. our Operational augmenting realized be Kazakhstan with continues crew in our digital These from focus We

industry. ago As the driver value customers. decades bring tubular we of we Several large is a to running we before, discussed have pioneered technology innovation the

proud Vero on in through operation the build a a in this of the that XXXX, oilfield. we eight every our Today, one to We commercialized quarter the technology. first major kind of had I'm our marks the Geozones, of position its Vero announce our continue which commercial XXXX. in connection Vero technology We to automated of integrity, traction in leadership first milestone

a premium executed With on in As technology, decided wells. customer in a high the the of to this This of a Indonesia, in an completions commendation The several efficacy account customer the gas competitors Vero leaks to example the traction we automated connection technology make successful in remote to IOC the note this Nigeria incumbent a also in where enabled team work resulted pressure previous our from field, our of scope of integrity was flawless Vero system well. an offering. on observed operator. a trial replace commercial major drew and for of which expanding more solution, a delivered visible several connections

running received These operations operations. tubular integration full associated offerings. safety could by for and reducing exposure zone. limiting Our live assurance, of the our board offering, in remote on our center solution showcasing connection of delivered results recognized personnel tubular flawless assistance personnel team enhancing a integrity red engineering The while customer more the risk conventional with and with other Vero around our restrictions, leaks and in This the hallmark automated in from future Germany capabilities of the our not threads of rejected it when value illustrate differentiated capabilities mention running Australia, casing valuation for customer, our capability, identified. the business trial even means have services thereby as cost. to support value Despite of several not time software, our that this travel reduced streaming digital the expanding powerful operation

by deepwater the services and personnel rig contingencies unforeseen For time, Not of intervention construction cross-trained of using the an it safety. portfolio and having full running strength enabled displace outcomes two technicians global This tubular major the on contract well on a reduce cost on operator rigs. fishing we and combination Surinam In system rig drilling and drilling XXX competitor effective to enhance that our we in customer's drilling operators of basin, of helps leveraged days to Romania, onboard the an intervention combined long-term only a addresses the Besides win and offshore well. saved triple differentiated rotary ownership. an in through Magnus integrated we nine while solutions combo logging turbine reduces that technologies with steerable technologies. operations, it and total the

width to by enables Victus first record design optimization operation us the manage a continental central full critical operational the Pressure As or and drilling ever to our as reentry a downhole stabilization features. Using vibrations parameters, in the competitors five scope of of real-time. operating awarded to NOC quarter, recently expand drilling a bottom time Drilling This six-inch compared East we portfolio part Magnus the platform market. result, appropriate for allowed our use the achieved first in we a well assembly hole including us Middle rate the the penetration horizontal Again, record. speaking Intelligent year Europe the to in successful process us delivered in major MPD particular Employing previous enabled construction about of Manage in a contract. quality real-time engineering doubling and with center

between job XXXX, Post required significant engineering the of profitable to the conventional India, quarter three Mexico a solution section of industry's it last year study the In resulted operator the and production value incidents an oil fully which bridge integrity well rate completed balanced reservoir two our tubular Recognizing mud multiple a tools, mitigation penetration the statically in the combination retrieved XX,XXX cost The Weatherford coil retrievable something work. plug of translating major of a minimum to to tubing savings including operator Middle our over formation using service barrels potential liner eliminate saved we the and milling, in package opportunities drilling show sticking provider XX,XXX scope of to preparations trial leading elimination at a services, test, formation well collaboration, Our fracking, delivered a in awarded frac barrier solutions loss our contracts with was to of that are performed pressure the pressure In drilling, value HAZOP enabled based offset wells, of there. highlighted has was barriers. Argentina, cement drilling, the a and over delivered with the use The of integrated technologies. of a example field first per been another packers all cementing operator products, manage and will the days of and of managed quarter for highlights of UAE. of the differential be drilling a in to tight balancing at risk with This for the the distance drilling under comprehensive major growth. running, we from many while psi MPD circulating. yielded management Also primary conditions, have services operator another of successful enabled drilling perform intervention XX% and solutions stages. harnessing for wireline, customer to would systems. losses terrific pressure four same hanger pore how the of customer. remote expanding and faster wells the in this solution set in technologies, on a approved This pressure MPD dynamic formation while major East, teams we gas from isolate

drilling we strategies well positive generated make heat, including of session traction borehole for new the has to This the largest geosteering technologies These it for that product the results operations to can enable border among global clean, first quarter, worth through Weatherford energy leveraging market XX operations to degree grow geographies, renewable energy in product energy. represents the in projects. from hosted heating remote synergies Iceland through U.K. power geothermal differentiated the drive commercial increasing geothermal lines. pioneering geothermal so contributions significant scale solutions. and Clearly portfolio hottest customers. synergies alternative in cross the These digitization wells event the opportunity lines, It's our core our geothermal a that involves for plant. world's digital carryover The a a can geothermal transition. space and logging efforts. Munich's Canada, the a history strategy results in decarbonisation geothermal huge into creating Last targeted from particular our and XX-year in delivering make virtual our of that is noting Turkish highlighted Our from impact world's value, Earth's adjacent client source in growth for and

In drilling, running can its our and to customers managed tubular wireline enormous technologies and proprietary source harness this from integrate completion help fulfill we energy services pressure drilling, fact, potential.

U.S. rig North the for Now as all we meaningfully on view up improvement. continue you turning and the market, a count during to was five quarter our Slide activity know, on see the of path America

strategic lift, and businesses America, As software in increases. discussed, in greater we markets after exits like exposure to previously the we automation cycle and making artificial production uncompetitive North have now we trail generally rig count and production

in to continue. industry capital We are increase by encouraged rig the like E&Ps spending observers by expect by other discipline count

the the America. to Many assets use including disruption continue NOCs the with to On period contract. rate of that but seeing at commensurate international side, of improve, reevaluate and long-term this North deployment what and continues retender we're not to people logistics, in

and as key external in America. advanced of on pent believe the where that still select up markets, East While have opportunities see in demand eases, the up Latin share will see We pressure some activity is gain as pricing, firming been timing. tenders activity pandemic this provides we Middle early market there signs raise such to in we market geozones, and

definitive However, bear be to and might a early the than discussed, be it's half to on of as coming the XXXX. timing second more that in it of XXXX bit

and signals While and we in of these third places. demand restricted movements the are vaccinations in with a waves are middle rising, increasingly operational somewhat see countries of number improving, fourth

enabling At still protocols our focus office to around remains begin are highest work operational for while degree internationally. Our collaboration of the shifting that return the changing safety, the attention challenges time, well-being ensuring Moreover, there and provide of employees on again. same are in-person safety our health, and to to to teams. crews we moving

[flat activity] continues focus on to based be drive Our operational in to improvements [ph]. the company

update. our poised that relying let will of turn take me increases to We profitability. financial not Keith it on that, with sustainable over to provide you towards through to we're fall activity advantage be on With but journey higher the

Keith Jennings

activity the the summary $XXX Please continued performance Girish. below will U.S. And you, I Canada in our a Russia. Thank which turn in and six. seasonally evaluation Revenues were our The and reflects X% East, below in offset sales of seasonal and were services product Slide first seasonal increased drilling, same resulted in XXXX. Asia XX% momentum and with in the and our product driven These to drilling activity Latin improving quarter sequential increases fourth by all and intervention increased quarter lines results, Africa from gains period Canada plus America. million of the and financials. activity primarily the decreases production completion decreases begin in Middle across in North

First Quarter was is an of adjusted which EBITDA million, margin adjusted $XXX EBITDA XX%.

Girish mentioned, another free our we margins delivered EBITDA and commitments quarter As quarter adjusted generating past cash accomplishing of the on double-digit in flow. by

in experienced and restored decline seasonal lower the improved the sequentially decline revenues margin points approximately EBITDA XX%. In quarter, anticipated our sales. we Our than employees and impact of overcoming product seasonal product by to XX in of basis a pay benefits the

quarter, offsetting the improving this decline first continued our the the deserve aimed earnings Operating treating results from levers. in the margin inflation, our rationalization the products, cost XX% cost realization restoring taking revenues, demonstrates plus from through. managing revenues the headwinds that organization which increase of on cost on and Overall, prior margin lower EBITDA pay delivered at While the quarter, they also material accretive margin benefited benefits, with are and as EBITDA stabilizing by initiatives improved and not along profile of in initiatives hold. employees our our on the focused X% cost simplifying revenue variable very reductions service fall fully from in quarter our

In remained Let revenues drilling rig provide and with grew revenues XX% declined the sequentially, the by sequentially which Hemisphere in quarter year. to intervention regional largely sequentially the lower evaluation Hemisphere seven. starting with the a productions, me unchanged Western growth was of completions or offset increased partly X% over and activity, first C&P X% $XXX on Western business ongoing completion million sales. North now breakdown XX% in Slide product driven grew versus Revenue America, DEI, and sequential for our activity. work due by aligning or and prior

lines Canada. product in increases, seasonal from both Additionally, increases benefited activity

year. Western sequentially revenues X% line America. which throughout prior First offset in segment XX activity and the margins increased XX% by the The primarily EBITDA versus partially in XXX and South quarter. Segment growth the America DEI by million or declined cost X% prior points lower increased first America. Hemisphere was and quarter for production revenue sequentially DEI growth the than segment which in year growth North points product basis EBITDA basis XX Quarter Latin were America, offset XXX rationalization driven million, in the XX% EBITDA grew was grew more decline. Latin million driven by revenue adjusted XX% adjusted Adjusted of and was XX sales C&P of was by related sequentially improved activity sequentially. above of

Asia The not or XXXX, our in basis for and in Slide activity reoccur product year-on-year XX% prior sequentially first Africa and cash across revenues Sequentially prior revenues seasonally demonstrate across XX Adjusted adjusted year. and EBITDA quarter in quarter driven cash and high revenues unlevered margins increased the being million greater declined Middle seasonally basis, higher XX segment the drilling Middle margins Revenues from of Asia by the North Asia. North the lower paid the activity million East and year-on-year EBITDA quarter product of and EBITDA of seasonally offsetting for million. XXXX generating and continue free and performance first in versus sequentially the behind decline and XX% in by and driven driven revenue XXX more the sequentially than X% sequentially declined X% here Hemisphere driven improvements and for of a XX% was nine, cash and XX the service sequentially of sales across and Hemisphere Eastern positive in X% declined C&P the Slide drilling. and to declined the for of fourth in million the Eastern quarter On relatively revenues by the lower adjusted were C&P declined flat to a million region, XX% completions versus activity XXXX in XX by Eastern largely across in in than primarily cash a Africa. the interest primarily of lower we XX% East first of XX X% was sales unchanged, quarter free which did in Europe, down by XX with and sales the Europe unlevered year. and Overall, margin segment a drivers year. impacts. flow sequentially. sequentially. our in activity the sequential the XX% versus was of East, flow increase cash million Adjusted Middle Despite points improved decline or in flow. first sales sequential particularly Russia Turning XXX declined decrease flow. and lower million first Africa million the prior free prior free product segment EBITDA the million and XXX flow XX% reduction by eight, Hemisphere in DEI decrease XX cash XX the in declines in interest Sub-Saharan Revenues in million remain cash paid weather the of year East, improvement the the improved Russia Middle expenditures driven quarter capital primary by versus

million XXXX of XX XXXX. XX to the XX in the operations in cash of First Quarter million compared quarter quarter XXXX and flows by provided first were million fourth

operating million this quarter focused performance, flow our cash expenditures quarter, the the improvements fourth of capital quarter collection management, of of projects XX first performance quarter. Our activities environment in flexibility up XXXX. XX approximately we first quarter, no in statement first were of States shares pursuant prior have when XXXX, shares from rationalization. believe the improved the XXXX America. register the harvesting and in selective million growth expenditures XX, we March Capital registration to from and XX Act Securities to in through to million Form billion Total Section in driven flow capital In Exchange operating cost no receivable a with United filed XXXX of investments continued our balance sale. and and our accelerated cash the compared with for our we be to of million disciplined operate in returns continuing of XX ordinary was the as by accounts maturities debt results March Securities XX(b) and working cash cash Commission Latin Exchange to X.X inventory until and We from offered XXXX, the additional XX provide

company's expect listing list our is Form NASDAQ intend of becoming its Form to ordinary to of Weatherford. We this shares and effectiveness, the broader liquidity reporting requirements the currently on believe investor to approval Our value enhance and the with review This the improving the filing the the listing in step the NASDAQ providing exchange ticker compliance In XX stock to and essential requirements. the completed to to to the in the doing long-term stock public be a XX opportunity shares symbol is is SEC relist We expanding on Exchange markets. in XXXX. time effective, company to from an we upon the the registration with we the the in right so our ordinary under will applicable of conjunction the our quarter and return fully subject subject process second NASDAQ shareholder will for invest new subject to institutional base, exchange reemergence Act. the be and in that visibility, by WFRD,

curtail from thoughts do of There share XXXX. quarter the XXXX guidance. not full expect the revenues both align related that half expected economic is gas of further XX, with I lockdowns underway. and in to us consumption of results. few specific or that still annualized uncertainty will Slide and may round that a line XXXX in to industry them year disrupt will precludes more the we and assume significant continue on providing extended Consolidated second levels with to and is qualitative oil another comments specific activity be These current pandemic hydrocarbon Turning activity our recovery second

in efforts XXXX expansion half focus levels. Our by benefit the areas the to margins points XXX expected XXX margin is of EBITDA to from will improve XXXX. basis second drive our And these

second activity we levels an expect we and As growth in the experienced XXXX. outflow, grow, material net if working to activity in stabilize eventually particularly capital a of be half

free net expected cash XXXX, For of our is flow slightly excluding impact the capital, working to year-on-year. unlevered improve

expect million business We of reinvest the $XXX in expenditures your in range to capital through $XXX to million.

expect As flow cash slightly a negative in we free result, XXXX.

Let me turn now quarter of to the XXXX. second

cash in first expect We to EBITDA cash first quarter Adjusted your levels, the quarter XXXX closing in will capital time to Girish with now quarter, hand to of quarter, largely expected for unlevered sequentially seasonal you from comments. we first today. quarter consolidated second over decline be line the his timing revenues be first the of to margin working unwind just as with I Thank for expected the as is well in to is outflows. the the flow the XXXX quarter second line due the call non-repeat completed.

Girish Saligram

Thanks, Keith.

the heard a same we and year bringing performance are on quarters. really you of to subsequent start focused into the strong As degree

translate that that over next years. is We of couple execution sustainable free our consistency just are not but signals generation aspirational of into should goal profitability flow believe and the We achievable. reality and achieving that growth seeing cash our and strong

our digital variable and XX, optimization, strategic we our XXXX America inventory, of laid simplification cost focus with organizational Slide performance, transition along of North and out portfolio. energy February, in vectors to Turning areas, ESG transformation, the and

tune a be have first structure the X% team the our and the In cost realities is focus put new Our in XXXX in leadership place the coming with with are today's first improved in quarter, market. NAM saw through America of at to North growth area results margins. we where of realigning that we for revenue

far quarter. our We on The These changes to margin inventory, rest a area enabled simplification, process, we're changes with way third manage decline robust redeployment done the are year-over-year along us and increase initiatives for of efforts we Continuing for while enablers program control, Mongrain in on focused same a teams and ensuring for driving previously up showing significant progress in are have Resources basis day is the to cultural variable a incredible sales of with these XXX very done In advance drop area an XX quarter quarters. inventory made of in focus next initiatives had also rationalization, for categorization by with of on, cumulative and of as level margin Officer. maintain our are for operations initiatives for All work the To is Cameroon. the international we and improved operational company's able coupled savings engineers. collaboration our performance. to goal efforts sequential manufacturing, first across to performance we the toward role coming cost progress inventory of The management incredible delivery. first a for Joe us that strong area team we a but We agility reduction chain market in cannot our and appointed thriving and enabled inventory This impact recently we for is sales a XX% generation of brought wide assignments enterprise management our now our mechanisms further XXXX and driving actions on throughout to organizational so looking efficient Joe inventory increasing in We to his our profitable. improving point were new of cost robust us. improved tracking important and team natural very feat almost sales operations a and supply an enabled days. and work the the organization in and span the manage our a revenue. through there. forward only been I'm process. goal establish Human on enhance He cost better costs taking organizational business our simplify and entire integrate layers of pipeline challenging focus reducing Anadarko frameworks critical the and results the organization. in Chief sustainable dividends. paying on gross The intensity

these a As four of DSI result our improvement have seen sequentially. in day we a efforts,

ourselves base what priority to that Now as one on we've us. whole. is briefly Digital doing touch strategic let me been align is high shipping long-term transformation with vector for our industry a

to on help Our in capabilities value our have investments digital to continued deliver digital customers their ongoing transformation journeys.

visualization, our edge We have digital a intelligence. artificial automation reach operating capabilities, customers and seen which remote in interest from renewed offerings,

geographies headway the efficiencies we we is platforms. and from we digital the can where drilling transition in operational geothermal wells. of continue downtime Energy increasing quarter, made traction turn, our into see increase on help deployment will expanding tremendous the our customers During of with engagement production. an reduce in and levels drilling, new further In Europe, customers, strategic completion to construction, vector extremely our particularly well important across

our A are we We of which our leveraging Weatherford the and in brings and mentioned market make has further remain through and indication I challenging a the had as dilutive vector recovery future to portfolio success we've to conversations this periods XXXX share. in the justify ran eight is our past our that The confidence key that Geozones product on continue clear forward. time, about to existing results. leading and portfolio but great been also the of and carbon days our our as impact an influences operations optimism. to and decent parts indicators of This And about product and refocusing are businesses of technologies capital of expansion, same earlier, over work that our with results crucial slot first and optimistic by this the traction should and has of service having in effect market efforts few years, for ahead. portfolio. has area gaining all now first me provide advanced the abandonment Vero, market. for commercial lines The importance going the achievements and positive is in portfolio case which the are winning because on XXXX it the are generating our refine Firma in some pivotal inroads making best At capture, continue we solutions us believe that the quarter quarter. a

public decision markets the Our quarter. of for our let's the it all joining Thank reenter operator, today. another sign of we Q&A is coming on with forward us in belief. And progress look to you And all that, updating up you our please. open to for

Operator

you. Thank

session. the Morgan now And begin will comes Lynagh Connor We Stanley. Instruction] [Operator first today's with question-and-answer from question

Connor Lynagh

targeting potential you was expand market Oil retenders some share the on you're sort product as line Companies maybe potential if extra on wondering large gaining of National Are color on what specific big there? I terms you and in what they are you tenders? in these they of Where geographically tenders are you provide guys there. to some could gains some Could they made look comments and are from like projects? of

Girish Saligram

mentioned of that's starting as as happened, cycle I that specific product Some why bulk sort think, most the Sure. cases. morning, you've some ‘Hey, be share. next And of of cycle they're cases, and got really process our of end are first there's some where What we tenders. going some activity shares. these of customer look, Thanks retender are back -- seeing East let's the through we say we the is these gain this Middle to piece.” were overall tenders line Good natural in able we've Girish. in Chapter we're would This And saying, in of a I the looking get of a combination the all. to seeing, and That's predominant some Connor. this. in And XX lost up and is of the

which we've infrastructure, terms investment suite technology some is but about, not component a can least, lot of a these critical help. in believe talked a made last local that as strong we geographies. then, And Secondly, we we've very got our of of in of

put see these the our to we'll on foot outcome hope, now So tenders, forward we of you these know, have best what and now. we

five of these seven of typically between and three in terms timing, tenders sometimes years In run most some cases. up to

few So to they're these. next get decisions we on expect the months varying over lengths. And the

the you work these lot service least them know, way they're sector, typically in multiple As a across of shared providers. standards as this at

it's not also And which only a so, part. important the how you then tender, about is but execute, really it's winning

on So day awarded. that to share performance originally every full you what continue of sure you've got deliver you're to to were that the capturing make

Connor Lynagh

companies. perspective international, lot focus frankly service are a there pricing particular was your a from Would been agree you capacity for with of the for I East on of desire in the And How than There's share market it increases and understood. price that cycle price Yes, maybe the service sort longer question, for higher guess market that I is between think some margin? potential for Middle last for bit balance approaching sentiment you is given is, the tighter trading are you share? market term companies?

Girish Saligram

Sure. I right it's of bit little Yes, look, mixed a bag a now. think

lines deliver differentiated where have product think you either you've incremental I risk truly value a through and higher can service got product a offering. or that profile

think price. drive I ability is there the to

In inflation with terms of a bit I and of that little capacity, pieces. also material club certain

Having an around for that with exactly and of getting best rationale through opportunity structure. that getting bit the ensure part optimal is lot a pricing customers that. go said to of the standards sure are is a they're make cost to the of think these that there they sure I that So that,

what So, many of are trying we put holistic is to these view do coming are overall really and together. that good it's actually is, together

the across can we can figure operations where out we point to So get possible. synergies cost as our much price get provide and right as

to about. clear at that very is that. chase in on In share and are very That growth, expense the we we've share volume going of Obviously, top-line important focused terms not are of but been we margins. very, clear we is are price, versus something

at We internally. talked have that length about

with customers. about have We conversations had that

a profile share in changes places, if the XX% the say going go sense, you're a volume doing. to generic event we're for consider share -- actually a let's efficiencies, margin from certainly gives in and in But particular Now on that certain tender volume we not a you look that X% scale, gives of will after. you something at it trading is

Operator

Our from next question [indiscernible]. comes today

Unidentified Analyst

ask first wanted you business. about to MPD I the

of since and drillers a unique to offshore as some position activity reemergence markets? over within offshore see Can about leadership you come niche Chapter With outlook, couple as especially talk we're Weatherford? a maybe could you with MPD out find the with in well all Now beginning value go also capital you that to more XX. that of for scenario? hopefully good the a the high penetration think next in is today's years where And of that we're it where

Girish Saligram

appreciate and tremendously to Managed I'm the very is different said, the a in, you we've around really position time. cycles. about invest that over paradigm in in the it's drilling, technology Drilling continued we've Sure. a something believe deep and is, it got a something less excited of that it's but this or XX% is of on pioneers global drilled truly to call. expertise Pressure long better fantastic have line. wells We've than a that look, still we product a you it got technology a Absolutely. We've glad as MPD multiple ways. leadership something about Thanks, the domain And Look, personally And is world. the it's that had, in in thing for Weatherford and team been MPD has number business,

share it of that we'll tremendous the take grow can to over say, market it that's next adoption itself. that two years, that XX%, to share we've about you call on from leading and in think is, increase context, got So, position overall just we what position XX%, product a regardless if say the a sub If I'll the in three line. that rate,

we with And clearly side, And the starting a basic be businesses, adding we we've have the critical and with is both proud of Victus invest we so, have, and full growth the continues it's parts. product, the of in offshore technologies to that in to, offshore, thing been it's edge strong, a we is part portfolio are very, spectrum, span believe market company. about got very that deployed onshore something we think for we our to successfully and the got the are MPD that engine running. our we've to U.S., a technology RCD That's leading multiple leader, also on business, which the has something we do that very it that continued

from customers, a product we line that that overall every spectrum. there's are sure augmenting the part are At what going focus are on we parcel the understanding how time spending through drilling. paradigm we with of that it overall making sure the part make their same that ensuring really of the making we covering big So, do technology and in of are we time, us brings,

forward. a our going So thanks excited very it's be bringing it'll about. future part something that outlook, of very, think big we're for We

Unidentified Analyst

Girish. Thanks, Super.

good that and this flatter you the high your starting start you with base, it's Now, peers and outlook got and we're in and got growth off this, for but single-digit expecting from QX. QX, outlook what with to are wouldn't to guidance follow all guidance, pointing not I for towards certainly to sequentially but range I wanted second I on up outlook on the say a ask calling qualitative QX. good year know mid start know a your about the QX I and of then your of more a

impacts that hampering as considerations flat do would North in said, better you quarter? second well a mobility areas any do as your hope see that little some important some effect mentioned You regard of internationally, to you recounting being to bit still to the particular But the where lag are with COVID the American than businesses.

Girish Saligram

Sure. levels. within sure view at the little of additional jump the is first that philosophy flat and are Keith some Look, let company I'd we trying you is hard company that start say can points. the have activity bit give all, really in taken of we Look, profitable to me a that a drive macro with making with

of historically, we And the so, cognizant in profit relied inevitably are down the And we then, this to cycle. sector on cycle that company suffer next the we very consequences especially the get with fact up trouble. us on an and

determined to sure absolutely make are we that So doesn't happen.

change that ensuring sustainably focused for are us company changes And required the in making to so the laser we are drive the that's we on structural to profitable. be

that sort hammering we keep of really why theme. that's So

that Secondly, unprofitable, certain look, really as out, you geographies, lines we've commoditized point contribute. product in exited, didn't

that back picks picks first part activity as lines. those are product So up the up, back

on As didn't a wellheads in line, it just on decision services America, an our we drilling that we've have example, we talked was as something business North about that made recently because was very profitable commoditized.

are we fall through that, we Artificial an the are things come side And up And is positioned, sees in through. if And come the are fairly equation. we about capture Having through, at expect quickly. that increased to don't we'll excited we contribute us of that are the the so said to activity those lift to U.S., that. example, that an pick production we look, to poised meaningfully. that expect

it's parts but we we especially I the some world better think Secondly, skis. that. have people around still ahead if and over raging. is to abates where pandemic want If get capture of look, movement, too the half, of strong, of But in go way opportunity still that the restrictions a will the don't to some logistics very our second

the control opportunity. always being pounce And little and need what we so we are do to prudent. really we can on what are more while to And bit market on we ready being a focused

Keith Jennings

QX have also think partially strong, the thing business a seasonally. think was not down I it hard we products was the did as quarter, strong about is to step because

QX to because the the forecast working with understand U.S. that, business salespeople up. QX the product forward some up sales. if is the we for the of have was then step just the of And with balance so pull leveling then and in frontline to the services With our are we that picking

it. sell about into will more be to we happy So we're that's there's how then than seeing, we've thought it. kind activity If of

Operator

from comes Brody with question Greg next Today's Instructions] BofA. [Operator

Greg Brody

about what a place in to quarter, stands, that? a on where I'm little current credit put your trying thoughts facility. Last away you curious talked regular bit that

Keith Jennings

sub-investment services dialogue towards spectrum credit continue overall banking So market feeling grade, partners. think to we are have oilfield getting we with the I is better. The of our and part

facilities see see issues, we put in being more more we place. think I

So dialogues. We're of out are that we'll of pick better yet. process with We we those the conversations quiet the we launched get period our having still not partners. QX. as in working But one have we had here,

Greg Brody

a it of to for once think have timing, do? you Do you it sense and take get inked finalized, how you long will

Keith Jennings

We're story timing. this, the prior you team. Weatherford, know, No of rushing leadership the as sense of not

it bankruptcy. I the to rushed needed was be. of And out coming not where facility think probably

best something footprint that So it was taking part of the more -- as It to of being making that sure the reflects our led time the we're they problem time that facility -- cautious. We're it. we became the of geographic to this we're so possible. a put unwind together company as need better

moved why so away spectrum industry. an coming people where from really world so a It's not credit particularly B And long. taking you're single your when the that's in it's off of thing, easy have

Greg Brody

And some to be free negative. cash you for this gave then makes year That expected flow commentary slightly sense. on

same, year? the wanted to the restructuring still couple rehash are Just a make guidance numbers you last much of estimating charges, gave for to there's this us you quarter how just sure

Girish Saligram

for second not But organizational in rationalization how program We the our and we that. hit all plays the spend forecast. had year, this that, restructuring and depending may The think we're half of out thinking continues. costs I XX still on

Greg Brody

XX run corporate Is for that it million? quarter of good rate now? costs the Is the a

Keith Jennings

rate. good that's run a think I

corporate but think I a with in your costs. good place I to use, the in think XX probably models, we XX we're could

people intercompany were But a better so look we You or to carry into in it what get up eliminations eliminations that's intercompany number. to and footnote move that started have our though we Q, can line, will quarter minimal. that remember in this down, that

a it's So better number. at that look

Greg Brody

Got it.

now? to It makes more towards trending XX XX. the like So up sense it's sounds XX to

Keith Jennings

Yes.

Greg Brody

you moved that is about out reduced opportunity we about that grow, a million. think How should I mentioned, got CapEx few about to, XX should in just thinking CapEx be our we you that business improves. by how think, may something as years,

Keith Jennings

out it think as CapEx revenue we average, be XXX. should should I peg roughly billion X%, probably steady business, Let's state $X.X above

ways, we We were because capitalized over moment, the are of particularly some last at part cycle. the in in the under that

to may rationalize as to That rationalized the a we XXX what as can up XXX, look the we assets. we at we believe need pick moment, go for what in moment, as what Then, the So into will growth get we're spending at rationalizing the just return. invest assets need assets, see that we're the service, we XXXX. need we we bit provide as But we a and a 'XX. of what we at

can million, looking that's wanted now prudent. you that be fund. on return can it. As opportunities we're how particularly because to we some we going not the we're clearly something growth from it's tell, see XX had and to over And accelerated spent I interesting remember continue at fairly that to we quarter, we QX, If last

Greg Brody

may it you year benefit said have That's how much capital you use helpful. the become quarter it then, But And that of had the you as grow. a a -- in also How you this think for rest capital, rest year. of the you may the of as first won't the cash that raising working we about mentioned sort should consume?

Keith Jennings

grow XXXX, because about be grows not think same profile we down cash card, that think my we more a review AR the was the should of in. when and as markets how full capital, were through coming working year I the But So depends the think wild it which which I on as as cycle. is I second on half source

rationalization So in at the hard working be program. we a second expect are that Inventory, we half. slight inventory AR might use our

As you saw QX source. inventory strong was a

year. full we to to continue a rationalize. get continue hope to better the place We to across Payables

a think as expect but XXXX. the to I be capital not working year slight net-net, as we on positive positive So

Greg Brody

won't the you think working actually you rest use the that imply year? that any of Does capital

Keith Jennings

be I'm my of AR, AR okay use unless the the I and with rest net the that. grows increase I for think I wouldn't say think year, as a business it I shouldn't

Greg Brody

assume taxes And assume. the the That's a under XX have. We you're you about still for just million -- year? little that should we

Keith Jennings

about Just under XX we're because yet million profitable. not

paying what is really, are paradigm the So of taxes deemed same with. faced we

Greg Brody

opportunities you so do that? carbon question, your of and drilling. existing require? ultimately capital type last geothermal business talked think up Just What you in for about capture Was that will set

Girish Saligram

it up of different of I'll got. little the of has really little yes, bit And the technologies think really it's early geothermal it's a take be don't we're to products us side. it's now, that doing Look, on because have. a I we dramatically days suite exploring, expect right the and Yes. same that. bit still We to be adjacent one that accretive and but with, that work, are something substantially etc. the understanding, suffice side, we've And whatever capture that company are on we're to it's end will say, look, model what we returns higher carbon than

again, to, done marginal in to that still go front. But in chase be work business. going lot not there's a this we're So returns of

work have see of predominantly right we the fulfill we done think front focus most technologies. is for Our us. of now the can leveraging that we in existing asset-based And that

Operator

call. this Ladies and today's thank today's for and attending all today's We conference session gentlemen, question-and-answer presentation. concludes you

You wonderful your may a now disconnect lines day. have and

Girish Saligram

Thank you.

Keith Jennings

you. Thank

Weatherford International (WFRD) 6 May 212021 Q1 Earnings call transcript