Revenue of $470 million, up 22% sequentially
and up 18% year-over-year.
Net income of $15 million, as compared to net
loss of $3 million for the first quarter of 2024 and net income of
$9 million for the second quarter of 2023. Net income margin was 3%
for the second quarter of 2024, compared to (1)% for the first
quarter of 2024.
Adjusted EBITDA1 of $95 million, up 40%
sequentially and up 32% year-over-year. Adjusted EBITDA margin1 of
20%, compared to 18% for the first quarter of 2024.
Increasing full-year 2024 revenue guidance
range to $1.70 to $1.75 billion, and refining full-year 2024
Adjusted EBITDA range to $350 to $375 million, supported by strong
first half of the year performance, positive market outlook, and
the successful early closing of the previously announced Coretrax
acquisition.
Expro Group Holdings N.V. (NYSE: XPRO) (the “Company” or
“Expro”) today reported financial and operational results for the
three and six months ended June 30, 2024.
Second Quarter 2024 Highlights
- Revenue was $470 million compared to revenue of $383 million in
the first quarter of 2024, an increase of $86 million, or 22%.
Revenue sequentially increased across all operating segments, with
the largest contributions from North and Latin America (“NLA”) and
Europe and Sub-Saharan Africa (“ESSA”) segments. Second quarter
operating results include $21 million of revenue attributable to
Coretrax.
- Net income for the second quarter of 2024 was $15 million, or
$0.13 per diluted share, compared to net loss of $3 million, or
$0.02 per diluted share, for the first quarter of 2024. Net income
(loss) margin (defined as net income (loss) as a percentage of
revenue) was 3% for the three months ended June 30, 2024 compared
to (1)% for the three months ended March 31, 2024. Adjusted net
income1 for the second quarter of 2024 was $31 million, or $0.27
per diluted share, compared to adjusted net income for the first
quarter of 2024 of $10 million, or $0.09 per diluted share.
- Adjusted EBITDA for the second quarter was $95 million, a
sequential increase of $27 million, or 40%, primarily attributable
to higher revenue, better activity mix across all operating
segments and contributions from the Coretrax acquisition. Adjusted
EBITDA margin for the second quarter of 2024 and the first quarter
of 2024 was 20% and 18%, respectively.
- Net cash used in operating activities for the second quarter of
2024 was $13 million, a decrease compared to net cash provided by
operating activities of $30 million for the first quarter of 2024,
primarily driven by an increase in net working capital, cash paid
for merger and integration expense, and cash paid for severance and
other expense compared to the prior quarter, partially offset by
the increase in Adjusted EBITDA. Consistent with historical
seasonal patterns, the increase in net working capital is expected
to reverse in the second half of 2024, resulting in an improvement
in net cash provided by operating activities.
1. A non-GAAP measure.
Michael Jardon, Chief Executive Officer, noted “We are pleased
to report another quarter of strong financial performance, with
revenue and Adjusted EBITDA exceeding guidance, including the
impact of the early closing of the Coretrax acquisition. Our
results reflect our commitment to deliver excellence and innovation
across our operations, and positions us for sustained,
through-cycle growth.
“Our strategic position in the international and offshore
markets continues to anchor the business, with increased activity
in mission critical, high value adding services. We continue to
maintain a positive outlook based on the fundamental backdrop and
increased global demand for services and solutions that support
lower-cost, carbon-advantaged incremental production. We believe
activity will continue to increase across geo-markets, with
long-cycle development providing good business momentum,
particularly for our drilling and completions-levered businesses.
In the second quarter, we captured $196 million of contract wins
and our backlog, while modestly down quarter-over-quarter, remains
strong at approximately $2 billion.
“In the second quarter, we completed the previously announced
acquisition of Coretrax, a technology leader in performance
drilling tools and wellbore cleanup, well integrity, and production
optimization solutions. Coretrax has a complementary offering to
Expro with little overlap and broadens the services and solutions
we offer through our Well Construction and Well Intervention &
Integrity product lines, adding significant value to our clients
from innovative technologies that reduce risk and cost, improve
drilling efficiency, extend the life of existing well stock, and
optimize production.
“We are continuing to leverage existing capabilities to grow our
Sustainable Energy Solutions business. Expro’s team in Australia
successfully executed well intervention services for recompletion
of a CO2 injector well for a leading carbon capture, utilization
and storage (CCUS) research organization. This is but one example
of where we are advancing clean energy solutions.
“In April, we also published our third sustainability report,
highlighting Expro’s achievements in 2023, the progress we have
made in working toward our environmental, social and governance
(ESG) objectives, and our commitment to being a citizen of the
world. These efforts resulted in MSCI increasing Expro’s rating
from an “A” to “AA” – the second highest rating.
“Expro remains focused on achieving excellent results for our
customers and is well positioned for continued improvement in
profitability, free cash flow and shareholder returns during what
we expect will be a multi-year growth phase for energy services. We
remain positive on the outlook for the international and offshore
energy markets and we are comfortable increasing full-year 2024
guidance range for expected revenues to between $1,700 million and
$1,750 million (versus prior guidance of between $1,600 million and
$1,700 million) and refining full-year 2024 guidance range for
Adjusted EBITDA to between $350 million and $375 million (versus
prior guidance of between $325 million and $375 million). Third
quarter revenue is expected to be between $410 million and $430
million, implying sequential and year-on-year revenue growth of
(11)% and 14%, respectively, with Adjusted EBITDA margin expected
to be in a range of 21% to 22%. Our expectation for a sequential
decrease in revenue followed by a fourth quarter rebound largely
reflects our strong second quarter results, commencing the
operations and maintenance phase of our Congo production solutions
project, and the expected start-up and completion of other
projects.”
Notable Awards and
Achievements
In the NLA region, we have seen further success in
commercializing our SeaCure® technology, which is designed to
provide optimal cement placement during the slurry pumping process
when the cementing unit shut down, preventing fluid contamination
that could have occurred without the SeaCure® solution.
Good business momentum is continuing in the ESSA region. Our
team in Ghana completed a 21 well development campaign using
Expro’s subsea landing strings. This job has run for 3 ½ years and
was completed with no injuries, no service quality events, no high
potential safety incidents, along with sustained operational uptime
of 99.7% across the entire campaign.
In the MENA region, Expro commenced operations for a major well
test contract onshore Middle East. The five-year contract requires
the mobilization of four trailer mounted conventional testing units
and four trailer mounted multi-phase meters, along with 150
incremental personnel.
Lastly, in APAC, we successfully completed our 100th job
globally with SeaCure®, marking a significant milestone. The job
was completed as part of a project in Australia consisting of a
five-well subsea batch campaign, highlighting Expro's expertise in
providing comprehensive solutions for complex offshore operations.
The technology was originally developed by DeltaTek, which Expro
acquired in February 2023.
Segment Results
Unless otherwise noted, the following discussion compares the
quarterly results for the second quarter of 2024 to the results for
the first quarter of 2024.
North and Latin America (NLA)
Revenue for the NLA segment was $157 million for the three
months ended June 30, 2024, an increase of $27 million, or 20%,
compared to $130 million for the three months ended March 31, 2024.
The increase was primarily due to higher revenue from all product
lines, in particular from higher well construction activity in the
U.S., Guyana and Trinidad and higher well flow management activity
in the U.S. and Argentina. The increase was supplemented by $5
million of additional revenue as a result of the Coretrax
acquisition.
Segment EBITDA for the NLA segment was $44 million, or 28% of
revenues, during the three months ended June 30, 2024, an increase
of $10 million, or 29%, compared to $34 million, or 26% of
revenues, during the three months ended March 31, 2024. The
increase in Segment EBITDA and Segment EBITDA margin was
attributable to higher activity and more favorable activity mix
during the three months ended June 30, 2024.
Europe and Sub-Saharan Africa (ESSA)
Revenue for the ESSA segment was $168 million for the three
months ended June 30, 2024, an increase of $47 million, or 38%,
compared to $122 million for the three months ended March 31, 2024.
The increase in revenues was primarily driven by increased subsea
well access revenue in Angola and higher well flow management
revenue in Congo. The increase was supplemented by $4 million of
additional revenue as a result of the Coretrax acquisition.
Segment EBITDA for the ESSA segment was $35 million, or 21% of
revenues, for the three months ended June 30, 2024, an increase of
$10 million, or 39%, compared to $25 million, or 21% of revenues,
for the three months ended March 31, 2024. The increase in Segment
EBITDA and Segment EBITDA margin was attributable to a combination
of a more favorable activity mix and increased activities on higher
margin services during the three months ended June 30, 2024.
Middle East and North Africa (MENA)
Revenue for the MENA segment was $81 million for the three
months ended June 30, 2024, an increase of $10 million, or 14%,
compared to $71 million for the three months ended March 31, 2024.
The increase in revenue was driven by $10 million of Coretrax
revenue, partially offset by a slight decline in revenue across
other product lines.
Segment EBITDA for the MENA segment was $29 million, or 35% of
revenues, for the three months ended June 30, 2024, an increase of
$4 million, or 17%, compared to $25 million, or 34% of revenues,
for the three months ended March 31, 2024. The increase in Segment
EBITDA and Segment EBITDA margin was primarily due to increased
activity on higher-margin projects and more favorable activity mix
during the three months ended June 30, 2024, including impacts of
the Coretrax acquisition.
Asia Pacific (APAC)
Revenue for the APAC segment was $63 million for the three
months ended June 30, 2024, an increase of $3 million, or 5%,
compared to $60 million for the three months ended March 31, 2024.
The increase in revenue was due to increased well construction
activity in Malaysia and Australia and well flow management
activity in Thailand supplemented by $2 million of additional
revenue as a result of the Coretrax acquisition, partially offset
by lower subsea well access activity in China and Australia.
Segment EBITDA for the APAC segment was $15 million, or 24% of
revenues, for the three months ended June 30, 2024, an increase of
$4 million compared to $11 million, or 18% of revenues, for the
three months ended March 31, 2024. The increase in Segment EBITDA
is attributable primarily to higher activity.
Other Financial
Information
The Company’s capital expenditures totaled $36 million in the
second quarter of 2024, of which approximately 90% were used for
the purchase and manufacture of equipment to directly support
customer-related activities and approximately 10% for other
property, plant and equipment, inclusive of software costs. Expro
plans for capital expenditures in the range of approximately $65
million to $75 million for the remainder of 2024.
As of June 30, 2024, Expro’s consolidated cash and cash
equivalents, including restricted cash, totaled $135 million. The
Company had outstanding long-term borrowings of $121 million as of
June 30, 2024. The Company’s total liquidity as of June 30, 2024
was $271 million. Total liquidity includes $136 million available
for drawdowns as loans under the Company’s revolving credit
facility.
Expro’s provision for income taxes for both the second quarter
of 2024 and the first quarter of 2024 was approximately $14 million
and $12 million. The Company’s effective tax rate on a U.S.
generally accepted accounting principles (“GAAP”) basis for the
three months ended June 30, 2024 also reflects liability for taxes
in certain jurisdictions that tax on an other than pre-tax profits
basis, including so-called “deemed profits” regimes.
On May 15, 2024, the Company established an incremental facility
under its Amended and Restated Facility Agreement, in order to
increase its existing $250 million revolving credit facility by an
additional $90 million in commitments, to a total of $340 million.
The incremental facility has the same terms and conditions as the
existing facility provided under the Amended and Restated Facility
Agreement. The incremental facility is available for the same
general corporate purposes as the existing facility provided under
the Amended and Restated Facility Agreement, including
acquisitions. On May 15, 2024, the Company drew down on the new
facility in the amount of approximately $76 million to partially
finance the Coretrax acquisition.
The financial measures provided that are not presented in
accordance with GAAP are defined and reconciled to their most
directly comparable GAAP measures. Please see “Use of Non-GAAP
Financial Measures” and the reconciliations to the nearest
comparable GAAP measures.
Additionally, downloadable financials are available on the
Investor section of www.expro.com.
Conference Call
The Company will host a conference call to discuss second
quarter 2024 results on Thursday, July 25, 2024, at 10:00 a.m.
Central Time (11:00 a.m. Eastern Time).
Participants may also join the conference call by dialing:
U.S.: +1 (833) 470-1428 International: +1
(404) 975-4839 Access ID: 661580
To listen via live webcast, please visit the Investor section of
www.expro.com.
The second quarter 2024 Investor Presentation is available on
the Investor section of www.expro.com.
An audio replay of the webcast will be available on the Investor
section of the Company’s website approximately three hours after
the conclusion of the call and will remain available for a period
of two weeks.
To access the audio replay telephonically:
Dial-In: U.S. +1 (866) 813-9403 or +1 (929)
458-6194 Access ID: 302382 Start Date: July 25, 2024, 1:00 p.m. CT
End Date: August 8, 2024, 10:59 p.m. CT
A transcript of the conference call will be posted to the
Investor relations section of the Company’s website as soon as
practicable after the conclusion of the call.
ABOUT EXPRO
Working for clients across the entire well life cycle, Expro is
a leading provider of energy services, offering cost-effective,
innovative solutions and what the Company considers to be
best-in-class safety and service quality. The Company’s extensive
portfolio of capabilities spans well construction, well flow
management, subsea well access, and well intervention and integrity
solutions.
With roots dating to 1938, Expro has more than 8,000 employees
and provides services and solutions to leading exploration and
production companies in both onshore and offshore environments in
approximately 60 countries.
For more information, please visit: www.expro.com and connect
with Expro on X @ExproGroup and LinkedIn @Expro.
Forward-Looking
Statements
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. All statements, other
than statements of historical facts, included in this release that
address activities, events or developments that the Company
expects, believes or anticipates will or may occur in the future
are forward-looking statements. Without limiting the generality of
the foregoing, forward-looking statements contained in this release
include statements, estimates and projections regarding the
Company’s future business strategy and prospects for growth, cash
flows and liquidity, financial strategy, budget, projections,
guidance, operating results, environmental, social and governance
goals, targets and initiatives, estimates and projections regarding
the benefits of the Coretrax acquisition, and the Company’s ability
to achieve the anticipated synergies as a result of the Coretrax
acquisition. These statements are based on certain assumptions made
by the Company based on management’s experience, expectations and
perception of historical trends, current conditions, anticipated
future developments and other factors believed to be appropriate.
Forward-looking statements are not guarantees of performance.
Although the Company believes the expectations reflected in its
forward-looking statements are reasonable and are based on
reasonable assumptions, no assurance can be given that these
assumptions are accurate or that any of these expectations will be
achieved (in full or at all) or will prove to have been correct.
Moreover, such statements are subject to a number of assumptions,
risks and uncertainties, many of which are beyond the control of
the Company, which may cause actual results to differ materially
from those implied or expressed by the forward-looking statements.
Such assumptions, risks and uncertainties include the amount,
nature and timing of capital expenditures, the availability and
terms of capital, the level of activity in the oil and gas
industry, volatility of oil and gas prices, unique risks associated
with offshore operations (including the ability to recover, and to
the extent necessary, service and/or economically repair any
equipment located on the seabed), political, economic and
regulatory uncertainties in international operations, the ability
to develop new technologies and products, the ability to protect
intellectual property rights, the ability to employ and retain
skilled and qualified workers, the level of competition in the
Company’s industry, global or national health concerns, including
health epidemics, the possibility of a swift and material decline
in global crude oil demand and crude oil prices for an uncertain
period of time, future actions of foreign oil producers such as
Saudi Arabia and Russia, inflationary pressures, the impact of
current and future laws, rulings, governmental regulations,
accounting standards and statements, and related interpretations,
and other guidance.
Such assumptions, risks and uncertainties also include the
factors discussed or referenced in the “Risk Factors” section of
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2023 filed with the SEC, as well as other risks and
uncertainties set forth from time to time in the reports the
Company files with the SEC. Any forward-looking statement speaks
only as of the date on which such statement is made, and the
Company undertakes no obligation to correct or update any
forward-looking statement, whether as a result of new information,
future events, historical practice or otherwise, except as required
by applicable law, and we caution you not to rely on them
unduly.
Use of Non-GAAP Financial
Measures
This press release and the accompanying schedules include the
non-GAAP financial measures of Adjusted EBITDA, Adjusted EBITDA
margin, contribution, contribution margin, support costs, adjusted
net income (loss), and adjusted net income (loss) per diluted
share, which may be used periodically by management when discussing
financial results with investors and analysts. The accompanying
schedules of this press release provide a reconciliation of these
non-GAAP financial measures to their most directly comparable
financial measure calculated and presented in accordance with GAAP.
These non-GAAP financial measures are presented because management
believes these metrics provide additional information relative to
the performance of the business. These metrics are commonly
employed by financial analysts and investors to evaluate the
operating and financial performance of Expro from period to period
and to compare such performance with the performance of other
publicly traded companies within the industry. You should not
consider Adjusted EBITDA, Adjusted EBITDA margin, contribution,
contribution margin, support costs, adjusted net income (loss) and
adjusted net income (loss) per diluted share in isolation or as a
substitute for analysis of Expro’s results as reported under GAAP.
Because Adjusted EBITDA, Adjusted EBITDA margin, contribution,
contribution margin, support costs, adjusted net income (loss) and
adjusted net income (loss) per diluted share may be defined
differently by other companies in the industry, the presentation of
these non-GAAP financial measures may not be comparable to
similarly titled measures of other companies, thereby diminishing
their utility.
Expro defines Adjusted EBITDA as net income (loss) adjusted for
(a) income tax expense, (b) depreciation and amortization expense,
(c) severance and other expense, (d) merger and integration
expense, (e) gain on disposal of assets, (f) other (income)
expense, net, (g) stock-based compensation expense, (h) foreign
exchange (gains) losses and (i) interest and finance (income)
expense, net. Adjusted EBITDA margin reflects Adjusted EBITDA
expressed as a percentage of total revenue.
Contribution is defined as total revenue less cost of revenue
excluding depreciation and amortization expense, adjusted for
indirect support costs and stock-based compensation expense
included in cost of revenue. Contribution margin is defined as
contribution divided by total revenue, expressed as a percentage.
Support costs is defined as indirect costs attributable to
supporting the activities of the operating segments, research and
engineering expenses and product line management costs included in
cost of revenue, excluding depreciation and amortization expense,
and general and administrative expense, excluding depreciation and
amortization expense, which represent costs of running the
corporate head office and other central functions, including
logistics, sales and marketing and health and safety, and does not
include foreign exchange gains or losses and other non-routine
expenses.
The Company defines adjusted net income (loss) as net income
(loss) before merger and integration expense, severance and other
expense, stock-based compensation expense, and gain on disposal of
assets, adjusted for corresponding tax benefits of these items. The
Company defines adjusted net income (loss) per diluted share as net
income (loss) per diluted share before merger and integration
expense, severance and other expense, stock-based compensation
expense, and gain on disposal of assets, adjusted for corresponding
tax benefits of these items, divided by diluted weighted average
common shares.
Please see the accompanying financial tables for a
reconciliation of these non-GAAP measures to their most directly
comparable GAAP measures.
EXPRO GROUP HOLDINGS
N.V.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except share
data)
(Unaudited)
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Total revenue
$
469,642
$
383,489
$
396,917
$
853,131
$
736,196
Operating costs and expenses:
Cost of revenue, excluding depreciation
and amortization expense
(366,520
)
(308,487
)
(318,948
)
(675,007
)
(608,595
)
General and administrative expense,
excluding depreciation and amortization expense
(26,225
)
(19,213
)
(16,186
)
(45,438
)
(29,471
)
Depreciation and amortization expense
(40,647
)
(40,146
)
(37,235
)
(80,793
)
(71,972
)
Merger and integration expense
(8,789
)
(2,161
)
(1,377
)
(10,950
)
(3,515
)
Severance and other income (expense)
236
(5,062
)
(2,663
)
(4,826
)
(3,590
)
Total operating cost and expenses
(441,945
)
(375,069
)
(376,409
)
(817,014
)
(717,143
)
Operating income
27,697
8,420
20,508
36,117
19,053
Other income (expense), net
334
485
(1,462
)
819
(2,411
)
Interest and finance expense, net
(3,666
)
(3,152
)
(17
)
(6,818
)
(1,315
)
Income before taxes and equity in
income of joint ventures
24,365
5,753
19,029
30,118
15,327
Equity in income of joint ventures
4,856
3,858
2,805
8,714
5,241
Income before income taxes
29,221
9,611
21,834
38,832
20,568
Income tax expense
(13,935
)
(12,288
)
(12,539
)
(26,223
)
(17,624
)
Net income (loss)
$
15,286
$
(2,677
)
$
9,295
$
12,609
$
2,944
Net income (loss) per common
share:
Basic
$
0.13
$
(0.02
)
$
0.09
$
0.11
$
0.03
Diluted
$
0.13
$
(0.02
)
$
0.08
$
0.11
$
0.03
Weighted average common shares
outstanding:
Basic
113,979,860
110,176,460
108,662,509
112,078,160
108,758,078
Diluted
114,923,702
110,176,460
109,381,977
113,688,752
109,975,739
EXPRO GROUP HOLDINGS
N.V.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
(Unaudited)
June 30,
December 31,
2024
2023
Assets
Current assets
Cash and cash equivalents
$
133,459
$
151,741
Restricted cash
1,994
1,425
Accounts receivable, net
533,735
469,119
Inventories
171,493
143,325
Income tax receivables
30,307
27,581
Other current assets
79,693
58,409
Total current assets
950,681
851,600
Property, plant and equipment, net
535,538
513,222
Investments in joint ventures
75,431
66,402
Intangible assets, net
321,144
239,716
Goodwill
342,576
247,687
Operating lease right-of-use assets
71,549
72,310
Non-current accounts receivable, net
8,590
9,768
Other non-current assets
11,070
12,302
Total assets
$
2,316,579
$
2,013,007
Liabilities and stockholders’
equity
Current liabilities
Accounts payable and accrued
liabilities
$
334,464
$
326,125
Income tax liabilities
51,852
45,084
Finance lease liabilities
2,242
1,967
Operating lease liabilities
17,454
17,531
Other current liabilities
93,866
98,144
Total current liabilities
499,878
488,851
Long-term borrowings
121,065
20,000
Deferred tax liabilities, net
47,704
22,706
Post-retirement benefits
7,070
10,445
Non-current finance lease liabilities
15,093
16,410
Non-current operating lease
liabilities
54,300
54,976
Uncertain tax positions
68,303
59,544
Other non-current liabilities
43,972
44,202
Total liabilities
857,385
717,134
Common stock
8,481
8,062
Treasury stock
(69,048
)
(64,697
)
Additional paid-in capital
2,064,089
1,909,323
Accumulated other comprehensive income
22,196
22,318
Accumulated deficit
(566,524
)
(579,133
)
Total stockholders’ equity
1,459,194
1,295,873
Total liabilities and stockholders’
equity
$
2,316,579
$
2,013,007
EXPRO GROUP HOLDINGS
N.V.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended June
30,
2024
2023
Cash flows from operating
activities:
Net income
$
12,609
$
2,944
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization expense
80,793
71,972
Equity in income of joint ventures
(8,714
)
(5,241
)
Stock-based compensation expense
12,420
9,748
Elimination of unrealized (loss) gain on
sales to joint ventures
(315
)
450
Changes in fair value of contingent
consideration
(6,172
)
-
Deferred taxes
(618
)
(6,823
)
Unrealized foreign exchange losses
(gains)
5,413
(1,820
)
Changes in assets and liabilities:
Accounts receivable, net
(33,756
)
(17,004
)
Inventories
(7,521
)
(1,440
)
Other assets
(14,127
)
(14,878
)
Accounts payable and accrued
liabilities
(11,129
)
31,919
Other liabilities
(12,805
)
(25,722
)
Income taxes, net
3,432
2,994
Dividends from joint ventures
-
2,754
Other
(2,745
)
(3,172
)
Net cash provided by operating
activities
16,765
46,681
Cash flows from investing
activities:
Capital expenditures
(67,107
)
(57,968
)
Payment for acquired business, net of cash
acquired
(32,458
)
(7,536
)
Proceeds from disposal of assets
2,900
2,013
Net cash used in investing
activities
(96,665
)
(63,491
)
Cash flows from financing
activities:
Release of collateral deposits, net
557
494
Proceeds from borrowings
117,269
-
Repayment of borrowings
(44,351
)
-
Repurchase of common stock
-
(10,011
)
Payment of withholding taxes on
stock-based compensation plans
(4,352
)
(2,835
)
Repayment of financed insurance
premium
(3,203
)
(4,277
)
Repayment of finance leases
(1,042
)
(1,164
)
Net cash provided by (used in)
financing activities
64,878
(17,793
)
Effect of exchange rate changes on cash
and cash equivalents
(2,691
)
(2,986
)
Net decrease to cash and cash
equivalents and restricted cash
(17,713
)
(37,589
)
Cash and cash equivalents and restricted
cash at beginning of period
153,166
218,460
Cash and cash equivalents and
restricted cash at end of period
$
135,453
$
180,871
Supplemental disclosure of cash flow
information:
Cash paid for income taxes, net of
refunds
$
22,672
$
21,644
Cash paid for interest, net
5,629
546
Change in accounts payable and accrued
expenses related to capital expenditures
6,306
2,809
EXPRO GROUP HOLDINGS
N.V.
SELECTED OPERATING SEGMENT
DATA
(In thousands)
(Unaudited)
Segment Revenue and Segment Revenue as Percentage of Total
Revenue:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
NLA
$
156,990
34
%
$
130,389
34
%
$
134,830
34
%
$
287,379
34
%
$
261,058
36
%
ESSA
168,431
36
%
121,746
32
%
138,062
35
%
290,177
34
%
251,710
34
%
MENA
81,429
17
%
71,494
19
%
59,163
15
%
152,923
18
%
110,108
15
%
APAC
62,792
13
%
59,860
15
%
64,862
16
%
122,652
14
%
113,320
15
%
Total
$
469,642
100
%
$
383,489
100
%
$
396,917
100
%
$
853,131
100
%
$
736,196
100
%
Segment EBITDA(1), Segment EBITDA Margin(2)
, Adjusted
EBITDA and Adjusted EBITDA Margin(3)
:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
NLA
$
44,474
28
%
$
34,377
26
%
$
36,703
27
%
$
78,851
27
%
$
68,577
26
%
ESSA
34,997
21
%
25,201
21
%
34,964
25
%
60,198
21
%
55,749
22
%
MENA
28,611
35
%
24,538
34
%
18,491
31
%
53,149
35
%
33,059
30
%
APAC
15,248
24
%
10,786
18
%
3,452
5
%
26,034
21
%
754
1
%
Total Segment EBITDA
123,330
94,902
93,610
218,232
158,139
Corporate costs(4)
(33,636
)
(31,300
)
(24,810
)
(64,936
)
(49,891
)
Equity in income of joint ventures
4,856
3,858
2,805
8,714
5,241
Adjusted EBITDA
$
94,550
20
%
$
67,460
18
%
$
71,605
18
%
$
162,010
19
%
$
113,489
15
%
(1)
Expro evaluates its business segment
operating performance using Segment Revenue, Segment EBITDA and
Segment EBITDA margin. Expro’s management believes Segment EBITDA
and Segment EBITDA margin are useful operating performance measures
as they exclude transactions not related to its core operating
activities, corporate costs and certain non-cash items and allows
Expro to meaningfully analyze the trends and performance of its
core operations by segment as well as to make decisions regarding
the allocation of resources to segments.
(2)
Expro defines Segment EBITDA margin as
Segment EBITDA divided by Segment Revenue, expressed as a
percentage.
(3)
Expro defines Adjusted EBITDA margin as
Adjusted EBITDA divided by total revenue, expressed as a
percentage.
(4)
Corporate costs include the costs of
running our corporate head office and other central functions that
support the operating segments, including research, engineering and
development, logistics, sales and marketing and health and safety
and are not attributable to a particular operating segment.
EXPRO GROUP HOLDINGS
N.V.
REVENUE BY AREAS OF
CAPABILITIES AND SELECTED CASH FLOW INFORMATION
(In thousands)
(Unaudited)
Revenue by areas of
capabilities:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Well construction
$
148,476
32
%
$
120,030
31
%
$
143,719
36
%
$
268,507
31
%
$
271,984
37
%
Well management(1)
321,166
68
%
263,459
69
%
253,198
64
%
584,624
69
%
464,212
63
%
Total
$
469,642
100
%
$
383,489
100
%
$
396,917
100
%
$
853,131
100
%
$
736,196
100
%
Supplementary information on specific amounts included in cash
provided by operating activities:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Net cash (used in) provided by
operating activities
$
(13,173
)
$
29,938
$
25,358
$
16,765
$
46,681
Cash paid for interest, net
2,719
2,910
(420
)
5,629
546
Cash paid for merger and integration
expense
9,712
2,280
9,076
11,992
11,400
Cash paid for severance and other
expense
6,334
3,148
1,999
9,482
4,571
(1) Well management consists of
well flow management, subsea well access, and well intervention and
integrity.
EXPRO GROUP HOLDINGS
N.V.
GROSS PROFIT, GROSS MARGIN,
CONTRIBUTION, CONTRIBUTION MARGIN AND SUPPORT COSTS
(In thousands)
(Unaudited)
Gross Profit, Contribution(1), Gross Margin and
Contribution Margin(2):
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Total revenue
$
469,642
$
383,489
$
396,917
$
853,131
$
736,196
Less: Cost of revenue, excluding
depreciation and amortization
(366,520
)
(308,487
)
(318,948
)
(675,007
)
(608,595
)
Less: Depreciation and amortization
related to cost of revenue
(40,571
)
(40,070
)
(37,074
)
(80,641
)
$
(71,831
)
Gross profit
62,551
34,932
40,895
97,483
55,770
Add: Indirect costs (included in cost of
revenue)
69,645
68,434
56,605
138,079
121,426
Add: Stock-based compensation expenses
2,785
1,646
2,049
4,431
3,423
Add: Depreciation and amortization related
to cost of revenue
40,571
40,070
37,074
80,641
71,831
Contribution
$
175,552
$
145,082
$
136,623
$
320,634
$
252,450
Gross margin
13
%
9
%
10
%
11
%
8
%
Contribution margin
37
%
38
%
34
%
38
%
34
%
Support Costs(4):
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Cost of revenue, excluding depreciation
and amortization expense
366,520
308,487
318,948
$
675,007
$
608,595
Direct costs (excluding depreciation and
amortization expense)(3)
(294,090
)
(238,407
)
(260,294
)
(532,497
)
(483,746
)
Stock-based compensation expense
(2,785
)
(1,646
)
(2,049
)
(4,431
)
(3,423
)
Indirect costs (included in cost of
revenue)
69,645
68,434
56,605
138,079
121,426
General and administrative expense
(excluding depreciation and amortization expense, foreign exchange,
and other non-routine costs)
16,034
13,046
11,288
29,080
22,788
Total support costs
$
85,679
$
81,480
$
67,893
$
167,159
$
144,214
Total support costs as a percentage of
revenue
18
%
21
%
17
%
20
%
20
%
(1)
Expro defines Contribution as Total
Revenue less Cost of Revenue, excluding depreciation and
amortization expense, adjusted for indirect support costs and
stock-based compensation expense included in Cost of Revenue.
(2)
Contribution margin is defined as
Contribution as a percentage of Revenue.
(3)
Direct costs include personnel costs,
sub-contractor costs, equipment costs, repairs and maintenance,
facilities, and other costs directly incurred to generate
revenue.
(4)
Support costs includes indirect costs
attributable to support the activities of the operating segments,
research and engineering expenses and product line management costs
included in Cost of revenue, excluding depreciation and
amortization expense, and General and administrative expenses
representing costs of running our corporate head office and other
central functions including logistics, sales and marketing and
health and safety and does not include foreign exchange gains or
losses and other non-routine expenses.
EXPRO GROUP HOLDINGS
N.V.
NON-GAAP FINANCIAL MEASURES
AND RECONCILIATION
(In thousands)
(Unaudited)
Adjusted EBITDA Reconciliation and Adjusted EBITDA Margin:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Total revenue
$
469,642
$
383,489
$
396,917
$
853,131
$
736,196
Net income (loss)
$
15,286
$
(2,677
)
$
9,295
$
12,609
$
2,944
Income tax expense
13,935
12,288
12,539
26,223
17,624
Depreciation and amortization expense
40,647
40,146
37,235
80,793
71,972
Severance and other (income) expense
(236
)
5,062
2,663
4,826
3,590
Merger and integration expense
8,789
2,161
1,377
10,950
3,515
Other (income) expense, net
(334
)
(485
)
1,462
(819
)
2,411
Stock-based compensation expense
7,350
5,070
5,577
12,420
9,748
Foreign exchange loss
5,447
2,743
1,440
8,190
370
Interest and finance expense, net
3,666
3,152
17
6,818
1,315
Adjusted EBITDA
$
94,550
$
67,460
$
71,605
$
162,010
$
113,489
Net income (loss) margin
3
%
(1
)%
2
%
1
%
0
%
Adjusted EBITDA margin
20
%
18
%
18
%
19
%
15
%
EXPRO GROUP HOLDINGS
N.V.
NON-GAAP FINANCIAL MEASURES
AND RECONCILIATION
(In thousands, except per
share amounts)
(Unaudited)
Reconciliation of Adjusted Net
Income:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Net income (loss)
$
15,286
$
(2,677
)
$
9,295
$
12,609
$
2,944
Adjustments:
Merger and integration expense
8,789
2,161
1,377
10,950
3,515
Severance and other (income) expense
(236
)
5,062
2,663
4,826
3,590
Stock-based compensation expense
7,350
5,070
5,577
12,420
9,748
Total adjustments, before taxes
15,903
12,293
9,617
28,196
16,853
Tax benefit
(75
)
(9
)
(32
)
(84
)
(43
)
Total adjustments, net of taxes
15,828
12,284
9,585
28,112
16,810
Adjusted net income
$
31,114
$
9,607
$
18,880
$
40,721
$
19,754
Reconciliation of Adjusted Net Income
per Diluted Share:
Three Months Ended
Six Months Ended
June 30,
March 31,
June 30,
June 30,
June 30,
2024
2024
2023
2024
2023
Net income (loss)
$
0.13
$
(0.02
)
$
0.08
$
0.11
$
0.03
Adjustments:
Merger and integration expense
0.08
0.02
0.01
0.10
0.03
Severance and other (income) expense
(0.00
)
0.05
0.02
0.04
0.03
Stock-based compensation expense
0.06
0.05
0.05
0.11
0.09
Total adjustments, before taxes
0.14
0.11
0.09
0.25
0.15
Tax benefit
(0.00
)
(0.00
)
(0.00
)
(0.00
)
(0.00
)
Total adjustments, net of taxes
0.14
0.11
0.09
0.25
0.15
Adjusted net income
$
0.27
$
0.09
$
0.17
$
0.36
$
0.18
As reported diluted weighted average
common shares outstanding
114,923,702
110,176,460
109,381,977
113,688,752
109,975,739
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240725903635/en/
Chad Stephenson – Director Investor Relations +1 (713)
463-9776 InvestorRelations@expro.com
Expro Group Holdings NV (NYSE:XPRO)
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