Earnings call transcript Q4 2022

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Weatherford International's Fourth Quarter and Full Year 2022 Earnings Call. [Operator Instructions].

As a reminder, this event is being recorded. I would now like to turn the conference over to Mohammed Topiwala, Director Investor Relations and M&A. begin. may you Sir,

Mohammed Topiwala

and the Call. Fourth Girish I'm Arun Officer. Vice and to Mills, and Year Chief our Saligram, and XXXX CEO, Accounting President Executive our Conference joined Mitra, Financial Weatherford everyone, Officer; Quarter Desmond International's Full President Chief Welcome, today by

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

section. You from our call corresponding to may today's download a Investor copy Relations of the presentation slides website's

statements are I actual remind These include that forward-looking forward-looking uncertainties of and some filings results materially from our comments to want any herein. today's subject that regarding latest our statements. expectation for Exchange to everyone Securities to differ cause Commission risks factors many risk expressed cautions statements. could refer and Please to and

financial which today our The on be reconciliation measures also and a non-GAAP non-GAAP release, GAAP in our are included comments press details can include of earnings underlying to financial found website. quarter measures. fourth Our

today's webcast, section following is reminder, website of call. this As being conclusion our recorded and version be on the a call will available a

to the With like turn I'd call Girish. over that, to

Girishchandra Saligram

Mohammed, you and joining for call Thanks, all today. the thank

the cash to team. every humbled and of the company. margin day outstanding goes being strategy to do I'm our customers quarter force and XXXX, share fourth Weatherford incredibly and the and members My spirit, you. performance; is by team for privilege you results the in expansion proud flow commercial Thank all the that The out immense delivered. revenue behind XX,XXX what strong gratitude of represent and our pride wins, all our Weatherford deliver of of we for deep growth, and our you resilience have and free Gratified and with of and gratified, given we driving talent all results delivered actions achieved; the have together One proud humbled. Weatherford our and come what to team of the

and generated cash There was milestones for achieved the growth free in lowest generated X notably, by over generate enable strength consecutive Revenue positive $XX of ratio rate to and refreshed XX the years. of year-over-year results X year in our margin most clearly expansion net reaffirm another and income results. of X.Xx, We time of operating demonstrate over in flow. significant effectiveness we over many XX%, years strategy full first over the perhaps XXXX years. These flow positive grew highest XX decades. It cash leverage million, a paradigm XX in are our our we the first free the in years

results marking performance, demonstrate the tenth transparency can complete. of and confidently say is successive stability, this the With turnaround that we Weatherford at quarter credibility, now

differentiation but to that and of are deliver a new continues now We operating Weatherford, performance. Weatherford the technology the people, culture, with around leadership credibility consistency and and in paradigm

share a phase Arun As value. the our and I of more our wanted range will highlights results. few we horizon the significant broader deliver of we cover details, a to have move to vision into confidently longer Desmond journey, next a but and more of

Our $X.X fourth XX% and X% of quarter year-over-year. XXXX billion was revenue up sequentially

general allowed to grow market top on and pricing us growth aided was increase. Our the directed line focus and by activity

driven the across margins We points on XX% sequentially delivered by I'm flow. execution solid board. by especially and cash basis performance EBITDA pleased with XXX our free expanding adjusted margins margins,

more in margin XXXX that years. the is quarter has In company XX in fact, than any the QX the highest EBITDA achieved

million performance. free interest in $XX the is million net improvements $XXX This made in despite The have additional we $XX higher our capital payments. alongside of cash reflected higher efficiencies, working adjusted were third in our than EBITDA flow quarter million

as profitability in we are income net full and equity the income would year sheet. income of XXXX, by to have in measured bet on and shareholder excited We of delivered turn net Weatherford million. $XX positive on million our balance leading being net to QX, Few $XX a page to add

acknowledge the manufacturing, we of our a improvements XXXX are clearly tailwinds fulfillment, our the we areas. on repair of fundamentally market, benefit intensity equally and platform. driven change to execution strong have and performance In focus the the While initiative multiyear our continued by company's begun sourcing

and centers, continue Over in the identified new logistics management since our year, XXXX. now new progress we operating we of the facility over exited a optimization, have on put facilities as to flagship course of make XX% our place system,

growth ensure that chasing We pressures and emphatic was provide and for consistently have growth margin we also price driving revenues from a I revenue as inflationary a not complemented company-wide focus systematically been with initiative offset area this suppliers incremental without directed wage and margins on increases. to the about us our lift.

execution. Excellence in

at inventory improved efficiency area improving year. DSI XX course reduction Overall, days in to XX an aimed enterprise environment. XX%. progress by saw a capital a working where our We improved growth year focus an year-over-year, by evidenced days, in revenue Our to by achievement of days the in over net effectiveness increased XX-day continued the impressive

Simplification.

to across overhead basis on to a year initiatives percentage as Our points focus and was global operational increase organization, full XXX of led more area basis. localized decline aimed in the at several and revenue accountability a delayering efficiency driving costs by over resulting

of crucial in are flow. delivering points margins our million $XX initiatives EBITDA year-over-year increases of in free basis and cash These XXX

cash years, generated X Weatherford has past flow, combined. the decades exceeds Over free $XXX which past the of million X

and both providing spectrum demonstrating solid our In the as foundation services a for we also beyond. of fourth XXXX, provider, commercial XXXX quarter broad and specialty many had a wins, position

quality the contract a fishing service consistent Kuwait attribute drilling safety directional KOC to We services, overcome and to logging provide provide in solutions East and Oil IOC major challenges. to Middle performance. while awarded awarded equipment to contract and win drilling a or Company us us X-year X-year which provide A this fit-for-purpose our services. complex

customer more than awards won with Latin in We operational completion deliver drilling integrated onshore and and American by our services enabled offshore a operations, X leadership. worth and million to $XXX technological

for with provision conveyance newly addressing of X-year Petrobras In chemical provider Brazil, requirements and our we play. system, the secured reliability the injection the pre-salt a award of sole enhanced

announced, services previously and and received to a deliver drilling the services Grater drilling and X-year contract Saqar underway. possibility turnkey of $XXX a fields, with the years from intervention LSTK Aramco already deliver lump we it with X in is to sum Marmul or which X-year million Oman contract As extending integrated exceeding Petroleum Development for

and Shifting technology partnership to highlights the our quarter. for

Firma to in well recognition in award in operation. reduced every emissions OWI Europe and Our decommissioning, rigorous an Firma enhance significant the showcases contribution Solutions' carbon Abandonment approach resulting our Plug for to won team industry. and safety This

commitment enable that technology value a We announced partnership This Abandonment value decommissioning our portfolio offering. Slot comprehensive leader our industry-leading innovation further Ardyne, deliver continuing significant in to Recovery Weatherford solutions. the in specialized to and partnership well creation the customers well Ardyne Firma and a demonstrates to and most of globally by with decommissioning Plug and will space and industry's offering enhancing

multiyear in construction our solutions a agreement in DataRobot, AI platforms. optimization including intelligence, central deliver production platforms, to advanced well artificial signed We digital a and ForeSite leader with

North for to start grow a flattening. In trajectory North at seen rate Now the we a to and XXXX, America still markets. growth several lower expect completions turning We expect high drilling view to the in and quarters America, of on our but last rate. activity, have the

supply and the constraints of we to side, correcting available. beginning On are logistical signs recovery, materials are are see becoming now as slowly raw

capture picking to and it across On market especially the are well portfolio, of offshore positioned offerings. MPD activity side, we up are with our seeing TRS signs our and

to markets across and the international all and our up-cycle multiyear The momentum support gain markets. of continues traction segments view

Middle America East opportunities be activity activity to there continue ramps as will up. and further robust, Latin incremental and be

overall for by the geopolitical despite be to macro continued the summary, inflationary environment In continues headwinds. sector fundamentals and solid supported

the is commercial of carry to $X.X our margins, our the company including and in as broad continue In advancements see with ability quarters, over footprint. wins over positioning forward the for wins of Our term. billion coming our momentum and flow focus the and across the XXXX, to NOCs technology will contracts, in IOCs customer impact long begin on success cash new partnerships, we to we evident

Our and over to next growing revenue margins mid-XX% the envision low to confidence on EBITDA enable focus operations business lean years. intense us few driving pipeline in the

a President and thrilled new Vice our as leadership Financial the Arun's also you caliber Chief attract have organization. team. to member added we to In We team. are to Executive Arun, Weatherford joined join January, we on of decision as Mitra volumes best-in-class Officer. to Arun a our talent speaks Weatherford

With about XXXX. our to specifically to like things quarter and I his as for that, through Arun followed to now guiding the Financial Before our Arun, it over Desmond interim Desmond performance finance leadership to in continued guidance for thank over to walk I'd team. Officer talk Chief to service quarter, hand like our more full I'd his us and hand this year of the financial first by Mills

Desmond Mills

and you, then and our joining Good move I'll results, you, into and Girish. Thank results for us flows. with on consolidated the begin everyone, cash our morning. call. segment thank liquidity

a quarter grew XXXX XX.X%, $X.XX momentum. full Full EBITDA growth EBITDA $XXX with year improvement. of or great Girish adjusted revenue As basis outlined, year with a close stellar we XX% margin, adjusted all billion fourth as point had XXX of to experienced segments the million out

was of $XXX quarter X% XXXX. billion, sequentially of in million $XX the million quarter of third fourth compared fourth the quarter in the income of and and fourth an XX% XXXX for Revenue XXXX to $X.XX Operating the in XXXX $XXX million quarter year-over-year. of increase was

of XX% $XXX a quarter XX% XXX net Adjusted margin million compared XX%, EBITDA increased of a quarter $XXX XXXX. was in with sequential sequentially fourth of income the improvement million the $XX $XX basis Net and in million the of loss and points. XXXX quarter of year-over-year in third of to EBITDA fourth adjusted million

ourselves across These focus of share by and coupled laid we for were successful improvement areas across pricing driven segments, with activity, execution our increased in results XXXX. out the primarily all

by sequentially, largely XX% drilling moving East, or adjusted attributable certain adjusted mainly regions. higher This to increases driven XX%, increase activity Segment wireline by drilling $XX Evaluation with of and North sequentially, leading QX. and QX. drilling Africa, million million back Now Middle increases all and of than in is higher to QX million Latin $XX America retroactive volumes DRE X% which results. into $XXX by or of managed services XXX or price points were million price services for increased revenues and to basis pressure segments and EBITDA higher EBITDA segment $XXX Asia nearly contracts, increased Drilling

in million Additionally, higher $XX East, and cementation Latin and and XX% by fall-throughs services. of regions. liner Asia or we construction EBITDA of from completion or North Africa, X% Middle the due $XX increased $XXX driven execution products to for by WCC Middle hanger million $X Well achieved by efficiencies million Africa, largely increased in revenues higher million drilling increased activity or primarily higher and the sequentially, North America and products and regions. hanger Asia fall-through Latin America Segment adjusted sequentially, East, cementation in liner

XX% or pressure by or Production international by million due higher increased PRI mainly and along sequentially, $XXX margin adjusted lift revenues pumping of pumping to XX% million North primarily increased or by activity Segment with driven fall-through Intervention America. artificial million activity $XX $XX million overall. of for sequentially, pressure EBITDA higher in $XX higher

Turning flows. liquidity to cash and

flow cash improvements of EBITDA million, million inventory utilization. increase was XXXX, flow provided working million. an higher as around fourth free cash were and especially cash by the operating $XXX flow sequentially. operating For million capital free year an as improved and cash driven These $XXX well by the In million margins primarily of efficiencies, was activities net $XXX $XXX million, was quarter, $XX $XX was full increase

performance outstanding and DSI improved X to drove XX days end quarter the plan improving with execution. We metrics on days operational at by sales

disruptions of XXX with cost some more services, We which progress revenue in XX.X% and impacts and XXXX, improving of chain efficiencies as inflationary price of the percentage from the coupled operating which offset XXXX basis points. This our efficient improvements, cost an a headwinds. structure, operational seen made a a high of from on utilization in to compared is lot was reflective improvement as XX% supply of products of

improvements We despite to capital which working XX% are our The are year-end than inventory initiatives. XXXX, beginning revenue. levels, benefits X% to inventory see up our evidenced less ongoing of were fulfillment a increase by the compared in and optimization

million some of XXXX down XX, fourth $X.X to of cash down as of billion debt. the $XX of quarter ended payments approximately our with made December We reflecting total XXXX, sequentially, pay

notes During the due of million in of we fourth senior the of paydown quarter, redemption previously XXXX. completed the debt principal XX% announced our amount $XXX

back million buying paydown we during our our in an purchases, and we XXXX. debt economics by of bought $X open also are the market par. open addition, additional In as We the quarter some the secured January X.X% market in our million opportunistic notes all below debt of on fourth of optimize $XX

million redeemed January we further also XXXX. December notes in in of a Finally, our senior it $XX XXXX calling XX% by

In debt paid of total, interest now by approximately profile the down have annual since our beginning a XXXX, expense we of $XX $XXX debt of we improve million continue reduce million. to as and total

stack XXXX at XXXX due debt $X.X senior in of XX%. at the note overall original XXXX due in in Our point X.XXX%, secured $XXX and million $XXX billion X.X% notes stub this at exit comprises of of notes million at due

to the facility aggregate & $XXX credit Finally, available during Poor to quarter and our increased we B million. under of upgraded Standard our credit also amount rating the fourth XXXX,

now for for quarter all the his XXXX. on the Arun to the year for time pass will and Thanks first call I outlook today. comments full your

Arunava Mitra

achieved introduction Desmond to strategic span. performance here, truly and excited morning, Thank the you, short in generate I XXXX for it's everyone. one. we over financial look be contributing company been full position to supporting returns to and good an busy to and with further first forward sustainable pivot Girish, has of a a to driving for such term. up so the and my the the company's as month the part just that longer organization much me I'm direction wrapped commentary, I

on expect a first basis by quarter grow consolidated to we XXXX, the to of mid- year-over-year revenues teens. high In

by by However, will mainly be QX to driven usual high FX mid- single the some QX decline there impacts. sequential and digits, to seasonality

high teens, seasonality. is to by by to expected DRE PRI Across expected mid-single digits. driven the the in low to segments, revenue high increase WCC to digits decline is to single expected is decline mainly and mid-

we are of which EBITDA to XXXX, by fourth margins catch-up Adjusted the augmented was XXXX XXX by first experienced to to quarter record expected basis quarter compared for XXX the decline points, adjustments. pricing in

QX, points. basis normalized So XXX to is decline the XX for around

witness the Although over XX%. they expected margins are in a will still to QX, be seasonal decline

$XX range to negative flow working the of the payments free to million during quarter. expected is will range due $XX and be to to million million cash capital $XX CapEx between negative seasonal in $XX million

growth compared Russia, business North in by XXXX, Our low full driven double expected to year XXXX a mid-single-digits internationally, to expected digits overall excluding consolidated with Russia drag to be mid-teens by revenues grow are growth to company our America, mid-teens on growth.

to Across growth, mid- growth, the deliver the segments, DRE is forecasted high to single-digits deliver deliver high high teens digits growth. and to mid- WCC to single to in PRI to mid-

and margin Regardless, be longer where uncertainty announced. XXXX headwinds we company cash also There new disruptions. in start-up supply our highlighted flow inflation, invest geopolitical we also we to year and to expansion labor the will confident the continue for have ability chain by in on and term be a deliver have the costs some contracts generation. are multiple

offset bias visibility aforementioned have have to a and upside. to and some significant to risk we fully expect opportunities slight the also the We

result, full XXXX. year expand margins are expected basis a by XXX points to EBITDA at As adjusted least over consolidated

$XXX expect million with is free flow be million. slight in to to with range line capital. in year We working bias and full XXXX growth the XXXX the net CapEx in expected CapEx be spite of cash for of to to higher $XXX a

a delivering our metered within returns spend As CapEx X% to with X% years, in we've the will and discussed. prior previously around our range be rigor

to Girish the comments. for you closing now call pass today. I for time Thank will your his back

Girishchandra Saligram

Thanks, Arun.

not time sense renewed, we these a and and rest. purpose. we time clear communicate Rather, forward marching take As now very rejuvenated XXXX with are results, and the are that we on to also is refreshed take a final celebrate lap to of

our As we next strategic to our share are the journey, of moving phase on imperatives. I will

this are However, will journey. priorities around, broader a our multiyear time be and

with achieve margin first remains cash The successfully growth We positive priority and along foremost we in could that XXXX performance. financial expansion flow. and demonstrated

XXXX to For ensure is driving cycle generation cash beyond, agnostic. are we flow and

now of support differentiation enhanced drive a and greater we advantage to and different leverage taking in technology cost the provide While up will cycle, efficiencies cycle.

priority second vitality. is The organizational

industry goal Our to upskill lead. team meet our continue and to challenges and develop to is

across lens. manner will investments, in like of rigorous and want all development they to. training grow more drive attract to team and will We a the greater investment this all We But talent, engage but also careers have the and other focus develop, in company. aspire levels payback retain our their great importantly, to

will continue the customer Next, experience. Customers everything do. be focal we we point to have of

help employ that customer As pipeline, ensure both satisfaction. want success our achieve processes, data opportunity and robust to we build us that technologies solutions, we we and

we ahead, our customer approach minimize sticky logistical a base services. total delivering maintain through forge customers we endeavor we by look faced our will challenges the to As and continuing building incident for at of uptime the to industry, want our Despite our rate.

the Efficiency is operations. priority waste fourth processes. lean will The elimination motives guide all internal and our that be

achieved support to agile this Our integrated various for maximizing a such of and through operations. is on we of achieved as combination on to and capital efficiency significant dollar on workflows bring the the provide company. a be [indiscernible] and ultimate the cycle. customer, built utilization This disparate tightening and will spent and systems, will value our together is factors value company become asset back processes the be increasing nimble change goal very a per as more working acquisitions costs, This

objective. Innovation tenet is this the Our final to key priority future. is creating achieving the

market. the to to unique introduce us new for will services a proposition our customers and products understand differentiate customers our be to people and that and in create value focus enable our of Our the needs

core energy for to and next We transition positioning will the and portfolios, digital thereby building ourselves services, actively decade. further continue engage our products in

continue ESG with committed our advance journey, Weatherford to and organization zero sustainability will net As that achieve our strategies is its to to stakeholders a responsible collaborate commitments.

we our We path. way, right of, ahead. I've and energizes what this a progress are long on have seen and I'm me that about journey the come the and capable excited reassures is organization

And questions, Thank please. operator, you the open for today. let's call now joining it up for

Operator

first Today's ISI. comes West question Instructions]. [Operator from Evercore James of

James West

to Congrats guess, longer you, a I know, curious on I for me. for Chuck, but there a question as great welcome you've quarter. little Arun. team, I first was the maybe well. And welcome been And

Weatherford much the out laid and all really ago. company going You that's years a where forward, X priorities just priorities important from several matured shows was

to kind of away? of or be? you success, that to X kind as what keys X would that we take key those should If understand pick important, of X the priorities I but X X were messages had X or what those are all

Girishchandra Saligram

Yes.

great I the financial end frankly, a James. an do. at question, of So everything we think the Look, is output day, of performance, that

So look us, XXX% to -- right. I the we it, at way for have you're

think We ability have lean effective. efficient But on to do operations to external more that notion to and be really all together ultimately our of and of whole customer how focus and I we deliver it it. everything more delivering experience, customers internally and drives this brings

James West

Okay.

enough. in you strengths about there? and well particular at to Could water. if you need for positioned MPD or really just in kind you in a your are guys these fill? And talk and and TRS holes maybe any and we're Okay. there And acceleration that Fair offshore product geographical just looking then inflection minute are of seeing nice deep how

Girishchandra Saligram

Yes.

inflection. a the excited Look, bit our is are So adopt as in MPD bit industry little look, to on starting a the referenced little we remarks we more. offshore prepared

have an have a multiple as that offshore that's, bit said the and value us leading-edge MPD technology both TRS on big our of for proposition think, exaggerated piece. for I more given space. types we a in And So positive

se, product at we we've So look, levels per multiple gaps any new us price drive position don't but think development different continue to different application and we to got points.

a be the about couple over the that of excited through we're we've coming year. got about pipeline that we'll course things So of the talking

Operator

today Luke Sandler. comes Lemoine from And Piper our with question next

Luke Lemoine

you us remarkable of the expand could you I on wondering pretty on these gave geo and geo outlook for if congrats to outlook in the wanted a was the on touched each here. and Girish, the turnaround markets I briefly see, 'XX? markets.

Girishchandra Saligram

grew America. Look, start North America. grow. to XX% last expect Sure. in we with I'll look North North year, at Again, as America over But we you

So certainly a to kind not of anything rate. close that

this high side. I the think going. the Gulf help North bit, offshore instead of little digits especially will see on we inflection to America Mexico is of a probably mid- single the where business Again,

was Latin most Look, America at on a numbers robust year. just our -- probably XX% grew region, basis, look you was last if it

taper the still are little to excited about America, our again We growth. Latin bulk be of We will bit. a down but got continuing that

we teens is East multiple so And building on probably excited will head about, growth times and the we're and percent and be regions, spearhead the stand-alone I've We the East and company be as a just of think the area will all XX-plus margin this will driving basis. most growth the Middle overall year, should that the on shoulders expansion. really to Middle call. referenced be other high above on

Russia, got There's as continues of complex a and Russia, especially bit volatility be And Russia currency. environment. then Europe mentioned, on Look you've drag. of will a a be a little we lot to and

to these level go. other of probably regions. outside it's not grow the but to predict any little hard So bit Europe exactly of of We think where that, that a will will

So little hopefully, a perspective. of that gives more you bit a

Luke Lemoine

about the you mid-XX% Yes, EBITDA And low range few to absolutely. the side, get your over goal on the to margin then years. to talked next

quarterly basis XQ. bit Can in the get it a a margin talk maybe you to the range level? what to on the get and low gap you takes mid-XX% course, little XX% bridge Of about

Girishchandra Saligram

Yes.

we a numbers, But a to things, be of that within The of So still bit up. of couple a look, was referenced, should QX. everything there a catch as of a attributed Desmond In I and out pricing our total year that right? Luke, bit are little numbers, little had Arun envelope. that think, fits important, catch-up QX pointed sort really

So net-net, to it's points. basis XX probably XXX about

that. to a of see margin very operational solid will perspective, going this an and that this year from it at said we year look continue to expansion strong I things continue we'll think drive you basis, on that, couple Having and we have If on.

that is and piece are we we'll few we to diligent do have talked in the a very, but going about, in last year of ready have our in first course that have to metered The over get company we decade or very be for all it about conscious systems, fashion, next investments processes, we X. the very a this

to So the a that's going the year. of little come over course in bit

our is a start-up new second especially bit the have little costs, contracts some And in in the maybe second and quarter. third the

a we've and bit But should sort a around little state repair are and we as as of new we that. consistent will a better of passed maintenance realm basis. our then that much year out look the be able year, So at it technology, fulfillment to we I of this bring network fully think that sort on where our in by be established, we I overall of into a end able platform as are think to transition really more got once we 'XX get and the

Operator

Goldman our And Ati question Sachs. with from today next Modak comes

Atidrip Modak

about see you working not, of if free do what conversion Are need a position from in just lot yet? talk in before EBITDA improvements happen You now normalized you talked cash there? to XXXX. flow about in get to a capital you else And

Girishchandra Saligram

relative a think extent. to couple Normalized it's is certain right? Ati, and look, a I word very of for all things, a broad --

I have debt is to blended is Look, payments, approximately are very as some they're yet. cash flow debt, debt for efficiencies believe we conversion the on of still we working you recognize right? to tremendous is manageable our done interest fully capital now, but of very we our think which about is progress us market X%, don't other have our today's made sizable you free EBITDA have while So a and think in I thing cost chunk competitive.

can manage bump, create bit ratio. a it will, think a of We does you we on little that certainly if conversion but that,

bit your our the this about be hopefully, that improve talk especially to our perspective, we've take more by little still we'll got payable think more opportunities think working So bit second side. And we means. sense side, I a of what we've capital a half time. little overall able But normalized to from on got year, to

Atidrip Modak

And for then, maybe you. it. one Got Arun,

we your the look the to the you Firstly, to your get think about would and think capital key terms about congratulations as I'd on like do to you for role, role? are you the achieve? like areas just milestones for And firm forward view of with what of firm allocation in working how you. the on focus the priorities

Arunava Mitra

you, to done, Thank lot of a the role, very and Yes, the tremendous been in excited to excitement be a I'm Ati. already work be made has of palpable. but amount progress is

mentioned But work to excited think Girish is very capital to there I'm So done as -- I optimization. be earlier, here. still to be on working the

to, basis, to conversion. XX% unlevered get XX% to on like I'd an So

balance our mentioned has resilience debt, our the on keep hits. that the and is down Girish the sheet debt, debt as down several priorities, times allocation recalibrate past, work cycle flexibility capital so priority in our to of the terms structure, our when we have In paying on

at stage. this of is priority clear resilience balance sheet a So the

Operator

next our Bank. Deutsche from comes James Hubbard today And with question

James Hubbard

have margin we're that and different I'm first majors? wondering, Congrats work the reconcile obvious oilfield in with then before that guys all all been me to I've week the course, all Is U.S. service in great My just you listening single-digit you heard CapEx. others others. sector we've on much Shell and it yourselves that said. the do those expansion included? of goes just low inflation results, can that for is, answer? from and And of not seeing the BP, help mid I'm question they're But They the -- direction. saying their Total do a wondering, on claim story

trying look more to to then like XX%, last in over take with to the years. And But traditionally calls, about past, some of it And XX% sector rid approach by at sounds cyclical has inevitably, maybe few very you're then getting people. -- decline. next the And lots few secondly, we the your point, new sector EBITDA forward different and margins activity the philosophically, of behaved worry the in Weatherford. a an analyst

riding whenever many from another it And see comes, the just envisage now, be, different wondering a years the path Weatherford for would how I'm workforce? hopefully, slash may Or of you next will be XX% ahead? you through downturn, it when do but it

Girishchandra Saligram

do Thank wide I we we'd them. anywhere, you a great both have is on much Look, North about But mix, our customer times we going look any company, are look, So more James, we again, one, revenues right? to kind outside Yes, geared, never it tell of at And do you of XX% you. have revenue more first questions. of our to internationally of very enough our that America. love for mix. the for am multiple do as a all talked right,

do the versus as we have greater of a IOCs. So NOCs a result, of proportion preponderance

mentioned. comes the So -- cost all The when look, is have we of as lot strategic improving They're pricing, Look, to other with the that. certainly efficiencies that. a first do to work companies very and along you the margin it that all a with NOCs. for expansion, us, in of talked and structure different X important we working pricing have effects, factor you right? on to addition on is our us you, But and in customers

that sort as cost company they add And the cost simple because level same total second come base of fall-throughs same we basis. -- on of view in is at on with just very a don't a mathematical

to have that's and us it to continue that margin expansion, we optimism gives into about So what future. able the being expand I think

of last Look, at the important very look, question, having really right. we've your second said I tried years. think, differently and look for So that, couple to is it you're

One of that up willing of sure that that spoken that downside bit give the fixing protecting cycle to the are in multiple about the cycle is are up it a we tenets times turn. I've on when we little are will to upside the and inevitably this we company make

build work, be mentality at time to a employee as slash burn that we you future. of proof, point, not base, soon Look, company if else, an that's more we like trying any more your it's have in and to cycle as no is down we But little this doesn't just everyone to And and cycle-agnostic, that will. hope believe, a are immediate bit organization. run cycle, you that is a way the going you

as billion. growth, on Look, look a exited revenue run rate So at we our really with of approximately working $X infrastructure. we are XXXX scalable you

If you it's in exit than look way to, at is change not what right? up we our XX%, even XX% rate are margin higher labor our more we to getting going third-party leveraging our that. we the a base has we into our the guiding also but that into just and be are again, driving employee So a how But this run we see. to part utilizing gone services, dramatic of efficiency, also that's are expansion customers. resource deliver automation base, how year big And our

Operator

And our next question today One. Becker comes from at Doug Capital

Unidentified Analyst

needed potential XXX disclosure, calls to full wanted gauge assumptions reach basis I expansion? that, the Girish, year, Last little improvement really Group benefits a points. this more for what points basis margin XXX to for least to the Weatherford margin's that trying EBITDA the but fulfillment at pricing just approach around differently. year and margin Guidance initiatives XXX are of point from I'm of to than basis margin upside outlook

Girishchandra Saligram

Yes. of have being line in making and that full changes, Doug, our sure guidance and and the give and not we we sight what and start with has there mentality off saying will on I all. at our pathway having of look, how get transparency of a credible really that a changed approach we terms

at we up even in [indiscernible]. activity our as If recollect, saw we XX and least look, you we and more, worked saw at, started basis way points, last we year,

on year, we have built this inflation. have in out of we increases in terms cost some assumptions as planned Look,

contracts, built have have, so we costs a nothing on factor. something doing assumptions is a nothing merit start-up environment We in are for just And Arun wage to untoward, going This increases. that's on is very but timing that all increase. we be important. a That's some members, these new as concerning, mentioned, it's team of our inflationary high

years in Saudi X for long-range and years the Oman. are one the These X contracts, one in for

the as in our have that a positive we factor a to that extent So continue is this was year. get look, pricing it of with we as going able an worked do bit to contributor, a be not is impact to probably but will But proposition believe year. the base. customers to quarter last able as and that our value significant cost we benefits, fourth We were some very well to were especially explain little

initiatives feeds you and quarter And as So into, we of with margin but we exact you on down of provide things that. we done of walk, look, have we a we say, points we the XXX made at in where come will to much broken basis the each the update we least all expansion. it have -- these see back think granular to that quantitative of all drive give past, haven't a in like how fashion progress

Unidentified Analyst

That SSA grew all very and Europe, sequentially. sounds XX% reasonable. Russia revenue

the highlight can this you drivers which primary Just of countries were growth?

Girishchandra Saligram

we on basis break And quarterly we to also by also have out but areas. look, had you country. it total But Doug, on don't So a again, multiple sequential at a year it growth basis. look

If you year was growth at X% it only basis, year-over-year. on a a it look total

we challenges of we other So to opposed some also regions. the the highlight see that as

Unidentified Analyst

you guidance, get then your just internal you little and want initial a not a road, this And on down total assessment Arun, the I maybe just Weatherford but to bit, segment little guidance? Fair. get providing revenue the attracted what color base of to on more anticipate maybe and company you would systems touched

Arunava Mitra

I pretty This don't question. the past. what know was Yes. been, question asked have a And common ago. thinking, here been should I the been Thanks answer in I has frequently which a for is my has year recent

palpable. This has platform and is ago. is drive to margin close which existential a the years in crisis a expansion. growth team So anywhere to look a does had this continued which being -- not X been company, an company excitement the This is on

is when imperative there if Weatherford, in although been team years, you and management bit of little extraordinary. has last able there dig the out of over accomplish -- it's to Google there was still you negative So this a terms -- X.X deeper and what understand

vertically, to communication horizontally transparent. And has is Girish a been team, together very of course, management able super put

last the in there levels seen of is based the direction of company. XX days, strategic some grassroot in alignment I've what And the on the

So I'm very excited.

segment margin EBITDA do We disclosures. don't

the as to it, but highlighted we'll quarters at So able points progress XXXX, compared you -- more as expansion be the in we least do XXX bias XXX Girish give earlier, basis see XXXX. guys upside the color to to an

Girishchandra Saligram

look, if that. to Doug, could just add And I Yes.

that to to we give committed more just you but things that lead will questions. very need are are helpful We sure we that make to also and you giving transparency, versus constructive information more

so in all give together. Our always job full retroactive you happened is we of this details of segment, base get company. sense a better a of bit exactly on our And to the each manage what around to the

in holistic size have still country we product an given got that where do single at scale, Look, we've our level. have a manage and effect, and situation individual lines to a a

Unidentified Analyst

Fair don't point. often, nice calls say And Girish, quarter. on very this but I

Operator

Instructions]. [Operator

America. Our next question of comes from Gregg of Bank Brody

Gregg Brody

I that a don't very on either. often say quarter. great Congrats

the mentioned capital allocation you -- Just priorities.

today? what structure. And focused bit right color debt is Can how the recalibrating on you that? debt little us You're give the you're a thinking number more about just

Girishchandra Saligram

Yes.

of a specific he's Look, foremost, as and out out another paid priority left. just target look, Gregg, in We we take stuff it number. $XX leverage in not stuff down take been coming So or of we called explicitly we that or to our have has up debt it We But started out have speed that. the a of that. debt and that. January, discussions I I'll have on Arun still million took laid December. first high lot to, have the cost to a

in away The call premium left million. So at $XXX we're on that December. goes

economics suffice on the be look won't say, that look, an that. to But the to I on issue term. at continue we'll So longer think

will quarter, volatility, taken care were in what fourth the -- of started buy that just went the able a our We little look, on below dipped doing we those some bonds get back saw basis market an of given to some got opportunistic bonds. we in bit we and And of. par as we

bring X%, So sort earlier, blended pare is down of cost very down of we'd little quantum look, but to Like that we want like mentioned a to bit more. to think, I continue we that competitive, debt. still

able have look, we about bit think, be the I a facilities, belt, more to we are get come to a our specific and under quarters our more down able we'll few of retrenching get credit once a conversation back that.

for a on biggest priority continues But be bit patience more the look, ask to us. I tad So that. just it for just would

Gregg Brody

Right. last place revolver. And put quarter, just a in new you

of you ability think able progress I to way the to was may is that for think year? the -- benefits the the made of of some a to there Have collateralized of play facility One being release cash? out the something that over with one Is any that's LCs. release about -- that cash how

Arunava Mitra

Yes, to in about QX $XX Gregg, in seen, I'll I've are QX. and on I take that. another $XX target release what million think Based on million we

million $XX So extent we through to to restricted first the of cash free the should up year. be able the of half

Operator

for session. to concludes final turn over question-and-answer to management and the gentlemen, ladies back our I'd like conference any this And remarks.

Girishchandra Saligram

QX taking our April all. all back the sharing coming We you today. you end look and Thank joining towards and for results. the Great. Thank time forward to of

Weatherford International (WFRD) 8 Feb 232022 Q4 Earnings call transcript