Forum Energy Technologies Inc (FET) 2024 Q2 法說會逐字稿

Good morning, ladies and gentlemen, and welcome to the Forum Energy Technologies second quarter 2024 earnings conference call.

早安，女士們、先生們，歡迎參加能源技術論壇 2024 年第二季財報電話會議。

My name is Gigi, and I'll be your coordinator for today's call. (Operator Instructions) At this time, all participants are in a listen-only mode. And all lines have been placed on mute to prevent any background noise. This conference call is being recorded for replay purposes and will be available on the company’s website.

我叫 Gigi，我將擔任今天電話會議的協調員。（操作者說明） 此時，所有參與者都處於只聽模式。所有線路均已靜音，以防止任何背景噪音。本次電話會議正在錄音以供重播，並將在公司網站上提供。

I will now turn the conference over to Rob Kukla, Director of Investor Relations. Please proceed, sir.

我現在將會議交給投資者關係總監 Rob Kukla。請繼續，先生。

Thank you, Gigi. Good morning, everyone, and welcome to FET's second quarter 2024 earnings conference call. With me today are Neal Lux, our President and Chief Executive Officer; and Lyle Williams, our Chief Financial Officer. Yesterday, we issued our earnings release, and it is available on our website.

謝謝你，吉吉。大家早安，歡迎參加 FET 2024 年第二季財報電話會議。今天與我在一起的有我們的總裁兼執行長 Neal Lux；以及我們的財務長萊爾威廉斯 (Lyle Williams)。昨天，我們發布了收益報告，可在我們的網站上查看。

Please note that we are relying on the safe harbor protection afforded by federal law. Listeners are cautioned that our remarks today may contain information other than historical information. These remarks should be considered in the context of all factors that affect our business, including those disclosed in FET's Form 10-K and other SEC filings.

請注意，我們依賴聯邦法律提供的安全港保護。請聽眾注意，我們今天的言論可能包含歷史資訊以外的資訊。應在影響我們業務的所有因素（包括 FET 的 10-K 表格和其他 SEC 文件中揭露的因素）的背景下考慮這些言論。

Finally, management's statements may include non-GAAP financial measures. For a reconciliation of these measures, you may refer to our earnings release. During today's call, all statements related to EBITDA refer to adjusted EBITDA. And unless otherwise noted, all comparisons are second quarter 2024 to first quarter 2024.

最後，管理階層的報表可能包括非公認會計準則財務指標。對於這些措施的調節，您可以參考我們的收益發布。在今天的電話會議中，所有與 EBITDA 相關的陳述均指調整後 EBITDA。除非另有說明，所有比較都是 2024 年第二季與 2024 年第一季的情況。

I will now turn the call over to Neal.

我現在將把電話轉給尼爾。

Thank you, Rob, and good morning, everyone. Now that we are halfway through the year, it is a good time to take stock of our progress, and I am pleased with our direction. Free cash flow results have been strong, and we have converted EBITDA into cash faster than our plan. This performance has provided confidence to raise our free cash flow guidance for full year 2024.

謝謝你，羅布，大家早安。現在已經過半了，是時候總結我們的進展了，我對我們的方向感到滿意。自由現金流結果強勁，我們將 EBITDA 轉化為現金的速度比我們的計劃更快。這項業績為我們提高 2024 年全年自由現金流指引提供了信心。

Also, we are in the process of redeeming more than half of our 2025 notes prior to the end of the third quarter, and it is our intention to retire the balance around the end of the year. At that point, the remainder of our debt will be fully pre-payable without penalty and will not mature until December 2026. This is a big step for our balance sheet.

此外，我們正在第三季末之前贖回一半以上的 2025 年票據，我們打算在年底左右贖回餘額。屆時，我們的剩餘債務將全額提前償還，無需支付罰金，並且要到 2026 年 12 月才會到期。這對我們的資產負債表來說是一大進步。

In addition, we are executing our beat the market strategy through new product development and international market penetration. These results are evident in our market share gains and increased sales outside of the United States, which were 50% of FET's total in the second quarter. Finally, our financial results demonstrate the positive benefits of the Variperm acquisition.

此外，我們也透過新產品開發和國際市場滲透來執行超越市場的策略。這些結果在我們的市佔率成長和美國以外地區銷售額的增加中得到了體現，這些銷售額佔 FET 第二季度銷售額的 50%。最後，我們的財務表現證明了收購 Variperm 的正面效益。

We have increased EBITDA nearly 50% year-over-year despite a more challenging market. The combination of our companies has successfully increased our scale and margins. As a management team, we have a strong focus on free cash flow. And this quarter, we generated $21 million through consistent profitability and improved working capital management. This allowed us to repurchase $13 million of our 2025 notes and announced the redemption of another $60 million.

儘管市場更具挑戰性，但我們的 EBITDA 年比成長了近 50%。我們公司的合併成功地擴大了我們的規模和利潤。作為管理團隊，我們非常關注自由現金流。本季度，我們透過持續的獲利能力和改進的營運資金管理創造了 2,100 萬美元的收入。這使我們能夠回購 1,300 萬美元的 2025 年票據，並宣布贖回另外 6,000 萬美元。

In addition, we are raising our full year 2024 free cash flow guidance to between $50 million and $70 million. The team continues to execute at a high level, and I am proud of their efforts. Putting it all together, we are following through on our plan to create value through a strong balance sheet. Once complete, FET would be positioned to return cash to shareholders around the middle of next year.

此外，我們也將 2024 年全年自由現金流指引提高至 5,000 萬至 7,000 萬美元。團隊繼續保持高水準執行，我為他們的努力感到自豪。總而言之，我們正在貫徹我們的計劃，透過強大的資產負債表創造價值。一旦完成，FET 將在明年年中左右向股東返還現金。

Last quarter, we discussed our growth and profitability strategy. This consists of four foundational pillars: growing profitable market share, developing differentiated products and technologies, utilizing our optimized global manufacturing and distribution footprint and expanding our participation in energy transition.

上個季度，我們討論了我們的成長和獲利策略。這包括四個基本支柱：不斷擴大盈利市場份額、開發差異化產品和技術、利用我們優化的全球製造和分銷足跡以及擴大我們對能源轉型的參與。

I'd like to provide an update on progress made so far. First, we are seeing the benefits from new product development. We have a growing opportunity pipeline within the power generation sector for our industry leading JumboTron XL heat transfer unit. The JumboTron XL is a critical component for power systems that are utilized for many applications, including AI data centers. The power gen market should grow rapidly over the coming years.

我想提供迄今為止的最新進展。首先，我們看到了新產品開發的好處。我們在發電領域為業界領先的 JumboTron XL 傳熱裝置提供了不斷成長的機會。JumboTron XL 是用於許多應用（包括人工智慧資料中心）的電源系統的關鍵元件。未來幾年發電市場應該會快速成長。

Importantly, these opportunities are geographically diverse with demand in the US, Middle East, Canada and Latin America. This is an exciting opportunity that expands FET's addressable market. We are also benefiting from our optimized global presence. To meet growing global demand and provide our products around the world, we do not need to expand our roof line or invest additional growth capital. We can service the world with the strategic manufacturing and distribution hubs that are already in place.

重要的是，這些機會分佈在不同的地區，美國、中東、加拿大和拉丁美洲都有需求。這是一個令人興奮的機會，可以擴大 FET 的潛在市場。我們也受益於我們優化的全球業務。為了滿足不斷增長的全球需求並在世界各地提供我們的產品，我們不需要擴大我們的屋頂生產線或投資額外的成長資本。我們可以利用現有的策略製造和分銷中心為世界提供服務。

A great example is our Saudi Arabian manufacturing facility, where we are delivering products and technologies to support unconventional resource development throughout the Middle East. These products include key hydraulic fracturing components, casing equipment and hardware, coiled tubing and artificial lift solutions. For the first half of 2024, we have grown our Middle East revenue by 16% compared to the first half of 2023. This highlights our ability to pivot with changing market conditions and grow where our customers are spending money.

一個很好的例子是我們的沙烏地阿拉伯製造工廠，我們在那裡提供產品和技術來支援整個中東地區的非常規資源開發。這些產品包括關鍵的水力壓裂組件、套管設備和硬體、連續油管和人工舉升解決方案。與 2023 年上半年相比，2024 年上半年我們的中東營收成長了 16%。這凸顯了我們適應不斷變化的市場條件並在客戶花錢的地方發展的能力。

Turning to the second quarter. We delivered revenue and EBITDA within our guidance range despite softer than expected US activity. Our year-over-year results demonstrate the benefit of our beat the market strategy and the Variperm acquisition. Our revenue increased 11% and EBITDA was up 48% with a 320 basis point improvement in margins. These results are particularly impressive given that the global rig count was down about 5%.

轉向第二季。儘管美國經濟活動低於預期，但我們的收入和 EBITDA 仍處於指導範圍內。我們的同比業績證明了我們超越市場策略和收購 Variperm 的好處。我們的營收成長了 11%，EBITDA 成長了 48%，利潤率提高了 320 個基點。鑑於全球鑽機數量下降了約 5%，這些結果尤其令人印象深刻。

Variperm performed well during the quarter, even though the Canadian market was down due to typical seasonality. While revenue was essentially flat, favorable mix and cost controls helped Variperm deliver increased EBITDA and margin contribution. They were also a meaningful portion of FET's free cash flow.

儘管加拿大市場由於典型的季節性因素而下滑，但 Variperm 在本季表現良好。雖然收入基本上持平，但有利的組合和成本控制幫助 Variperm 實現了 EBITDA 和利潤貢獻的增加。它們也是 FET 自由現金流的重要組成部分。

Revenue synergies from the acquisition are starting to reap benefits. By working closely with Variperm's experts to expand FET share, we increased our artificial lift and casing equipment sales in Canada by 5%. Also, we are leveraging an existing distribution network to have product readily available for these customers. Gaining share in a new market takes time, but we do have some early wins.

收購帶來的營收綜效已開始顯現成效。透過與 Variperm 的專家密切合作，擴大 FET 份額，我們在加拿大的人工舉升和套管設備銷售額增加了 5%。此外，我們正在利用現有的分銷網絡，為這些客戶隨時提供產品。在新市場獲得份額需要時間，但我們確實取得了一些早期勝利。

Now let me give you additional color on the prior quarter's market conditions and how it impacted our results. In the US, E&P consolidation continues to slow drilling and completion spending as companies evaluate their combined portfolios. Also, weak natural gas prices contributed to a decline in US rig count and hydraulic fracturing activity.

現在讓我進一步介紹上一季的市場狀況及其對我們業績的影響。在美國，隨著公司評估合併後的投資組合，勘探與生產整合繼續減緩鑽井和完井支出。此外，天然氣價格疲軟導緻美國鑽機數量和水力壓裂活動減少。

Internationally, rig activity declined 6% due entirely to Canadian breakup. Outside of Canada, rig count was flat with strengthening activity from shale plays in the Middle East and Latin America. Also, offshore activity remains vibrant as demonstrated by our strong subsea quotation pipeline.

在國際上，鑽機活動下降了 6%，這完全是由於加拿大的解體。在加拿大以外的地區，鑽機數量持平，中東和拉丁美洲頁岩油活動加強。此外，海上活動仍然充滿活力，我們強大的海底報價管道證明了這一點。

Now let me turn to our outlook for the remainder of the year. We believe it is unlikely that US rig count and hydraulic fracturing activity will experience a significant increase from current levels. As a result, we now expect US rig count to be down 15% on average for the year compared to our initial expectation of a 5% decrease. However, the benefits of our Variperm acquisition and beat the market strategy should mitigate the softness.

現在讓我談談我們對今年剩餘時間的展望。我們認為，美國的鑽機數量和水力壓裂活動不太可能比目前的水平大幅增加。因此，我們現在預計今年美國鑽機數量將平均減少 15%，而我們最初的預期是減少 5%。然而，我們收購 Variperm 的好處和擊敗市場的策略應該會緩解疲軟的情況。

With this revised market outlook, we are reducing the top end of our 2024 EBITDA guidance by $10 million. Therefore, our updated range is now $100 million to $110 million. We anticipate the third quarter to be relatively on par with the second with revenue in the range of $200 million to $220 million and EBITDA in the range of $24 million to $28 million.

根據修訂後的市場前景，我們將 2024 年 EBITDA 指導上限減少 1000 萬美元。因此，我們現在的更新範圍為 1 億至 1.1 億美元。我們預計第三季將與第二季持平，營收在 2 億美元至 2.2 億美元之間，EBITDA 在 2,400 萬美元至 2,800 萬美元之間。

Despite this change in our EBITDA guidance, we have increased confidence in our ability to generate free cash flow. As a result, we have increased our guidance range by $10 million to between $50 million and $70 million. This reflects the benefit of our capital light business model and operational execution.

儘管我們的 EBITDA 指引發生了變化，但我們對產生自由現金流的能力信心增強。因此，我們將指導範圍增加了 1,000 萬美元，達到 5,000 萬至 7,000 萬美元。這體現了我們輕資本商業模式和營運執行的優勢。

I am now going to turn the call over to Lyle for more details on FET's second quarter financial results.

我現在將把電話轉給萊爾，以了解有關 FET 第二季度財務業績的更多詳細資訊。

Thank you, Neal. Good morning, everyone. I will begin my comments providing more color on our strong cash flow and our balance sheet. We generated free cash flow of $21 million in the second quarter. This represents an 81% EBITDA to free cash flow conversion, a decrease in net working capital driven by inventory management and good collections contributed to the strong free cash flow results.

謝謝你，尼爾。大家早安。我將首先為我們強勁的現金流和資產負債表提供更多的色彩。第二季我們產生了 2,100 萬美元的自由現金流。這意味著 81% 的 EBITDA 轉化為自由現金流，庫存管理驅動的淨營運資本減少以及良好的收款能力促成了強勁的自由現金流結果。

Reductions in inventory have generated significant cash flow so far this year. Our teams continue to drive down inventory by tightening our supply chain. We are reducing the flow of inbound raw material to match market conditions while still meeting customer demand. We have the ability to drive inventory lower and will push for increased inventory turns.

今年到目前為止，庫存的減少已經產生了大量的現金流。我們的團隊繼續透過收緊供應鏈來降低庫存。我們正在減少進口原材料的流量，以適應市場狀況，同時仍滿足客戶需求。我們有能力降低庫存，並將推動提高庫存週轉率。

Our efforts to achieve more timely collections are also paying off. We have achieved significant improvement in our days sales outstanding since the beginning of 2023. In fact, excluding the impact of Variperm, our second quarter DSOs decreased by nine days year-over-year. Net-net, we have reduced working capital by $11 million this year, which boosted our free cash flow results.

我們為實現更及時的收款所做的努力也得到了回報。自 2023 年初以來，我們的應收帳款週轉天數取得了顯著改善。事實上，排除 Variperm 的影響，我們第二季的 DSO 年比減少了 9 天。今年，我們減少了 1,100 萬美元的營運資本，這提高了我們的自由現金流結果。

Recall that our prior free cash flow guidance assumed no reduction in net working capital. With the net working capital reduction already achieved and our plans for the remainder of the year, I want to reiterate the guidance Neal discussed earlier. We are raising our full year free cash flow guidance to $10 million, with working capital benefit driving the overperformance.

回想一下，我們先前的自由現金流指引假設淨營運資本沒有減少。鑑於淨營運資本削減已經實現以及我們今年剩餘時間的計劃，我想重申尼爾之前討論的指導。我們將全年自由現金流指引提高至 1,000 萬美元，營運資本效益推動了超額績效。

We ended the quarter with $32 million of cash on hand and $103 million of availability under our revolving credit facility with total liquidity of $135 million. Our net debt was $225 million. Utilizing annualized first half EBITDA, net leverage ratio was 2.2 times, a slight improvement from the previous result.

截至本季末，我們手頭現金為 3,200 萬美元，循環信貸額度下的可用現金為 1.03 億美元，流動性總額為 1.35 億美元。我們的淨債務為 2.25 億美元。以上半年年化EBITDA計算，淨槓桿比率為2.2倍，較先前結果略有改善。

Last quarter, we laid out a plan to put FET in position to return cash to shareholders. With the announced $60 million partial redemption of the 2025 notes in August, our current liquidity and guided free cash flow, we remain on track with this plan. We expect to retire the 2025 notes around the end of this year and the seller notes around the middle of next year.

上個季度，我們制定了一項計劃，讓 FET 能夠向股東返還現金。隨著 8 月宣布部分贖回 6000 萬美元的 2025 年票據，我們目前的流動性和指導自由現金流，我們仍將按計劃實施。我們預計將在今年年底左右收回 2025 年票據，而賣方票據將在明年年中左右收回。

With low leverage and a flexible capital structure, we would be in a position to return cash to shareholders through share repurchases or dividends. And this would still leave considerable free cash flow for further reduction of our revolver balance, strategic growth investments, our incremental distributions. We will continue to evaluate refinancing options that could accelerate this plan while we execute in the third and fourth quarters.

憑藉低槓桿和靈活的資本結構，我們將能夠透過股票回購或股利向股東返還現金。這仍然會留下大量的自由現金流，用於進一步減少我們的左輪手槍餘額、策略性成長投資和增量分配。我們將在第三季和第四季執行時繼續評估可以加速該計劃的再融資方案。

Now let me provide comments on our segment results. The Drilling and Completions segment revenue decreased 2%, primarily due to lower sales of ROVs, cable management systems and treating iron. During the quarter, coiled tubing revenue increased 24% as the international markets caught up from a slower first quarter. We also saw a 50% increase in frac power and shipments as we added a new large customer and had an increase in refurbishment work.

現在讓我對我們的部門結果發表評論。鑽井和完井部門收入下降 2%，主要是 ROV、電纜管理系統和處理鐵的銷售下降。本季度，隨著國際市場追趕第一季的放緩，連續油管收入成長了 24%。由於增加了新的大客戶並增加了翻新工作，我們的壓裂功率和發貨量也增加了 50%。

Lower revenue and less favorable product mix drove the segment EBITDA decline of 16%. Orders were $110 million, down 6% with a book-to-bill ratio of 94%. Orders for drilling and stimulation related capital equipment were lower during the quarter, partially offset by increased international orders in the coiled tubing product line. The artificial lift and downhole segment revenue was up 6%.

收入下降和產品組合不佳導致該部門 EBITDA 下降 16%。訂單額為 1.1 億美元，下降 6%，訂單出貨率為 94%。本季鑽井和增產相關資本設備的訂單減少，部分被連續油管產品線國際訂單的增加所抵銷。人工舉升和井下業務收入成長 6%。

Higher sales in the Middle East for both our casing equipment and valves products drove the growth. Favorable mix in the downhole product line pushed segment EBITDA up by 9% and EBITDA margins up 70 basis points to over 22%. Orders were $70 million, a 20% decrease due to our production equipment product line, where order timing creates swings quarter-to-quarter. The outlook for production equipment is solid as their backlog remains strong with a year's worth of work in the system.

我們的套管設備和閥門產品在中東的銷售增加推動了成長。井下產品線的有利組合推動該部門 EBITDA 成長 9%，EBITDA 利潤率成長 70 個基點，達到 22% 以上。訂單量為 7,000 萬美元，下降了 20%，原因是我們的生產設備產品線的訂單時間會造成季度與季度之間的波動。生產設備的前景是光明的，因為其積壓訂單仍然強勁，系統中的工作量相當於一年的工作量。

Now let me provide some color on our revenue by geography given the disparity between activity in the US and international markets. In the second quarter, international revenues grew to 50% of our total revenue compared with 35% just a year ago. This shift is significant given the softness in the US. As Neal mentioned, our strategy to grow internationally is making progress.

考慮到美國和國際市場活動之間的差異，現在讓我按地理位置對我們的收入進行一些說明。第二季度，國際收入占我們總收入的 50%，而一年前為 35%。鑑於美國經濟疲軟，這項轉變意義重大。正如尼爾所提到的，我們的國際成長策略正在取得進展。

Second quarter international revenues were up 13%, with the majority of the improvement in the Middle East. There, we recognized large project shipments of coiled tubing and of valves manufactured in our Saudi Arabian facility. Downhole revenues also strengthened with market share gains for casing hardware and artificial lift products.

第二季國際營收成長 13%，其中大部分成長來自中東。在那裡，我們確認了沙烏地阿拉伯工廠生產的連續油管和閥門的大型項目出貨。隨著套管硬體和人工舉升產品市場份額的增加，井下收入也有所增強。

In addition to growth in the Middle East, our Canadian revenues grew slightly in contrast to our expectations of a decline due to spring breakup. These results demonstrate the value of our global footprint in mitigating the softer US market. And the US market has been down this year. Our revenue correlates with rig count. So when the US market begins to improve, we should benefit.

除了中東地區的成長之外，我們在加拿大的收入也略有成長，這與我們因春季分手而下降的預期形成鮮明對比。這些結果證明了我們的全球足跡在緩解美國市場疲軟方面的價值。而今年美國市場一直在下滑。我們的收入與鑽機數量相關。所以當美國市場開始好轉時，我們應該會受益。

To wrap up, let me provide a few details for modeling purposes for the third quarter. We anticipate corporate costs and depreciation and amortization expense to be roughly in line with the second quarter. We will see reduced levels of interest expense in future quarters with a $13 million of the 2025 notes repurchased in the second quarter and the $60 million redemption in August.

最後，讓我提供一些用於第三季建模目的的細節。我們預計企業成本以及折舊和攤提費用將與第二季大致持平。我們將看到未來幾季的利息支出水準下降，第二季將回購 1,300 萬美元的 2025 年票據，並在 8 月贖回 6,000 萬美元。

For the third quarter, we expect interest expense to be approximately $8 million or about $700,000 less than the second quarter. For the fourth quarter, we should realize an incremental $600,000 of benefit from the reduced amount of outstanding 2025 notes. With the retirement of these notes, we will write off the related unamortized debt discount and debt issuance costs. These were roughly $3.5 million at June 30. The discount originated in 2020 when we issued the notes and recognized a gain based on the fair market value estimated at that time.

對於第三季度，我們預計利息支出約為 800 萬美元，比第二季度減少約 70 萬美元。在第四季度，我們應該會因 2025 年未償票據數量的減少而增加 60 萬美元的收益。隨著這些票據的退役，我們將沖銷相關的未攤銷債務折扣和債務發行成本。截至 6 月 30 日，這些金額約為 350 萬美元。該折扣源於2020年，當時我們發行了票據，並根據當時估計的公平市價確認了收益。

In the third quarter, we expect a nonrecurring charge of approximately $1.8 million associated with the $60 million we were deemed in August. Finally, we anticipate income tax expense in the back half of 2024 to be slightly higher than the $6 million reported for the first half of this year.

在第三季度，我們預計非經常性費用約為 180 萬美元，與 8 月我們認為的 6,000 萬美元相關。最後，我們預計 2024 年下半年的所得稅支出將略高於今年上半年所報告的 600 萬美元。

Let me turn the call back to Neal for closing remarks. Neal?

讓我把電話轉回給尼爾，讓他發表結束語。尼爾？

Thank you, Lyle. Looking ahead, we expect the US market to remain soft and down from our original estimate earlier this year. However, our outlook for Canada and the international markets remains intact and will help mitigate this additional softness. We will continue to execute and deliver financial results that support our long-term strategy.

謝謝你，萊爾。展望未來，我們預計美國市場將保持疲軟，且低於我們今年稍早的最初預期。然而，我們對加拿大和國際市場的前景保持不變，並將有助於緩解這種額外的疲軟。我們將繼續執行和交付支持我們長期策略的財務表現。

Our focus on cash generation is paying off. We raised our guidance and expect to generate strong free cash flow this year. Our plan remains on track to retire both the 2025 notes and sellers term loan around the middle of next year. This will provide greater flexibility and optionality for returning cash to shareholders.

我們對現金生成的關注正在得到回報。我們提高了指導，預計今年將產生強勁的自由現金流。我們的計劃仍有望在明年年中左右收回 2025 年票據和賣方定期貸款。這將為向股東返還現金提供更大的靈活性和選擇性。

To conclude, I would like to thank our global team for their hard work and dedication, especially our Houston area employees impacted by Hurricane Beryl, despite having limited or no power, self-service or Internet, they found a way to get the job done.

最後，我要感謝我們的全球團隊的辛勤工作和奉獻精神，特別是受颶風 Beryl 影響的休士頓地區員工，儘管電力、自助服務或網路有限或沒有，但他們找到了完成工作的方法。

Again, thank you. Gigi, please take the first question.

再次感謝您。吉吉，請回答第一個問題。

Thank you. (Operator Instructions). Dave Storms, Stonegate.

謝謝。（操作員說明）。戴夫·斯托姆斯，石門。

Good morning. Just hoping we could start with cash flow guidance. Great to see it take a step up. Could you help us understand just kind of some of the puts and takes that will put you on either the higher or lower end of that guidance range?

早安.只是希望我們可以從現金流指導開始。很高興看到它更上一層樓。您能否幫助我們了解一些看跌期權和看跌期權，這些看跌期權和看跌期權將使您處於該指導範圍的較高或較低端？

Maybe I'll start and let Lyle jump in. I think in general, we're seeing a good conversion of working capital into free cash flow. So our teams are focused on reducing DSOs and really matching the inventory that we're receiving to market demand. So I think with the guidance that we laid out for EBITDA, we feel really confident in the free cash flow range that we've provided.

也許我會開始並讓萊爾加入。我認為總的來說，我們看到營運資金很好地轉化為自由現金流。因此，我們的團隊專注於減少 DSO 並真正使我們收到的庫存與市場需求相符。因此，我認為根據我們為 EBITDA 制定的指導，我們對我們提供的自由現金流範圍非常有信心。

I'll give a little bit of detail there. If you think about the key contributors, that's going to be maybe a swing plus or minus in EBITDA given our full year EBITDA range. And then the free cash flow range is a little bit wider and that's the flux is going to be plus or minus on working capital that Neal talked about. So if we're closer to the top end of our EBITDA range, I think we'll get a little bit less juice out of the working capital, just based on higher accounts receivable. But if we're at the bottom end, I think we get the opposite. And so they've kind of net each other out.

我將在那裡提供一些細節。如果你考慮一下主要的貢獻者，考慮到我們全年的 EBITDA 範圍，這可能會導致 EBITDA 的正負波動。然後，自由現金流範圍會更寬一些，這就是尼爾談到的營運資本的變化。因此，如果我們接近 EBITDA 範圍的上限，我認為僅基於較高的應收帳款，我們從營運資本中獲得的收益就會減少一些。但如果我們處於最低端，我認為我們會得到相反的結果。所以他們有點互相排斥。

Understood. That’s very helpful. Thank you. And then, I know there's a lot of anticipation around returning capital to shareholders middle of next year. Is there any more color you can give us on what that may look like? I know you mentioned repurchases or dividends. Maybe just any variables that would sway your decision or is the decision one way or another?

明白了。這非常有幫助。謝謝。然後，我知道人們對明年年中向股東返還資本抱有很多期待。您能給我們更多關於它可能會是什麼樣子的顏色嗎？我知道你提到了回購或股息。也許只是任何會影響你的決定的變量，或者決定是這樣還是那樣？

It's something that we're obviously thinking about a lot. We have some time. But I think to us, the key is we are going to return cash to shareholders, something we really want to do. And so we're going to really evaluate all the options and see what makes sense for long term. So we think it's a commitment that we need to be consistent with, and that's where we want to be as a long-term company.

顯然，這是我們正在思考的事情。我們還有一些時間。但我認為對我們來說，關鍵在於我們要將現金回饋給股東，這才是我們真正想做的。因此，我們將真正評估所有選項，看看什麼對長期有意義。因此，我們認為這是我們需要遵守的承諾，這也是我們作為一家長期公司想要實現的目標。

Understood. And if I could ask one for international. I know coming out of the first quarter, the international markets may be a little slow to release their budgets, so that 50% number in 2Q. How much of that may be a catch-up? And how much of that maybe is a really good baseline for FET Co.?

明白了。如果我可以要求一張國際機票。我知道從第一季開始，國際市場發布預算的速度可能會有點慢，因此第二季的預算將達到 50%。其中有多少可能是追趕的？對於 FET Co. 來說，其中有多少可能是一個真正好的基準？

Yeah, Dave. The 50% of our revenue that's international is really a shift from what was 35% last year. So as we've grown international, we've added Variperm, which is another contributor there, and US is a little softer as a percentage of our revenue, it's larger. Also, if you think about the sequential increase, overall international revenues were up 13%. So we do experience some pluses or minuses around project shipments. So we mentioned some of the valves in coiled tubing catch up maybe sequentially.

是的，戴夫。我們 50% 的收入來自國際市場，這與去年的 35% 有所不同。因此，隨著我們的國際發展，我們添加了 Variperm，它是那裡的另一個貢獻者，而美國在我們收入中所佔的比例有點軟，但它更大。此外，如果您考慮環比成長，您會發現整體國際收入成長了 13%。因此，我們確實在專案交付方面經歷了一些優點或缺點。所以我們提到連續油管中的一些閥門可能會依序趕上。

But I think very importantly is the market share growth that we've seen outside the US, whether that's around our casing hardware business, we mentioned artificial lift products, and some of that incremental frac power in sales that we had were aimed specifically at unconventional plays in Latin America and the Middle East. So we've had some market share gain there as well.

但我認為非常重要的是我們在美國以外看到的市場份額增長，無論是圍繞我們的套管硬體業務，我們提到的人工舉升產品，以及我們銷售中的一些增量壓裂能力專門針對非常規產品在拉丁美洲和中東演出。因此，我們在那裡也獲得了一些市場份額。

Yeah. Very helpful. And if I could just ask one more question. You mentioned, you've brought on a customer in Drilling and Completions, pretty sizable customer. Just curious as to what the overall customer acquisition environment is like, especially given all the pickup in market share internationally.

是的。非常有幫助。如果我能再問一個問題就好了。您提到，您在鑽井和完井領域引進了一位客戶，相當大的客戶。只是好奇整體客戶獲取環境是什麼樣的，特別是考慮到國際市場份額的不斷上升。

Yeah, one of our core values is to remain customer-focused and we look at the markets where we participate, and we want to find customers where we can solve their problem. And for many of our products, they last longer. They allow our customers to go deeper, they've reduced their overall OpEx. And so we want to get that value proposition in front of as many customers as possible in markets where we have good scale and can generate more margins.

是的，我們的核心價值之一就是保持以客戶為中心，我們著眼於我們參與的市場，我們希望找到可以解決他們問題的客戶。對於我們的許多產品來說，它們的使用壽命更長。它們讓我們的客戶能夠更深入地開展業務，並降低了整體營運支出。因此，我們希望在我們擁有良好規模並能夠產生更多利潤的市場中，向盡可能多的客戶展示這一價值主張。

And I think we're seeing a kind of a, let's call it, a secular trend is the exportation of let's call it, technology that we've utilized in unconventional resources in the US, exporting that technology overseas. We've seen it in coiled tubing, we've seen in stimulation intervention. We've seen it in other drilling.

我認為我們正在看到一種，我們可以這麼稱呼它，一種長期趨勢，我們可以稱之為，我們在美國非常規資源中使用的技術的出口，將該技術出口到海外。我們已經在連續油管、增產幹預中看到了這一點。我們在其他鑽井中也看到過這種情況。

And so that's where we're able to take advantage as we've helped this industry the productivity gains this industry has achieved come from products that we provide. We've seen that productivity in the US and we're helping grow that productivity internationally with that same technology.

因此，這就是我們能夠利用的優勢，因為我們幫助這個產業提高了生產力，而這個產業所實現的生產力提升來自於我們提供的產品。我們已經看到了美國的生產力，我們正在利用相同的技術來幫助提高國際生產力。

That’s all. Very helpful. Thank you for taking my questions. Good luck on the third quarter.

僅此而已。非常有幫助。感謝您回答我的問題。祝第三季好運。

Dan Pickering, Pickering Energy Partners.

丹‧皮克林，皮克林能源夥伴。

Good morning, gentlemen.

早安，先生們。

Good morning, Dan.

早上好，丹。

Canada, impressive performance there. I think I heard flat quarter-to-quarter for Canada revenues overall, and then also think I heard flat Variperm quarter-to-quarter revenues. Is that right?

加拿大，那裡的表現令人印象深刻。我想我聽說加拿大整體營收季度環比持平，而且我還聽說 Variperm 季度營收持平。是這樣嗎？

Canada was 5% up. So I think what we wanted to say is our casing hardware and artificial lift solutions, we grew our share there a little bit, so about 5%. But Variperm was essentially flat quarter-to-quarter. Despite obviously, spring breakup.

加拿大上漲了 5%。所以我認為我們想說的是我們的套管硬體和人工舉升解決方案，我們在那裡增加了一點份額，大約是 5%。但 Variperm 季度環比基本持平。儘管很明顯，春天分手了。

Okay. Right. And that, I guess, certainly caught my eye because it's a pretty substantial difference relative to kind of your thought it could be down as much as half. Was there a customer win? Was it just steadier business than you expected? Or is it just getting to know Variperm and the volatility in that business and it surprised you a little bit?

好的。正確的。我想，這肯定引起了我的注意，因為相對於您的想法來說，這是一個相當大的差異，它可能會下降一半。有客戶獲勝嗎？業務是否比您預期的更穩定？或者只是了解了 Variperm 以及該業務的波動性，這讓您有點驚訝？

I think the steady is part of it. The other part is the share we gain by utilizing Variperm's contact distribution network. I mean that team up there has done a fantastic job with their customer base and they've opened a lot of doors for us. And again, we're early on in that revenue synergies, but we're excited about that potential.

我認為穩定是其中的一部分。另一部分是我們透過利用 Variperm 的聯繫分銷網絡所獲得的份額。我的意思是，那裡的團隊在客戶群方面做得非常出色，他們為我們打開了很多大門。再說一次，我們處於收入協同效應的早期階段，但我們對這種潛力感到興奮。

Yeah. That's awesome. Earlier in the year, you talked about sort of second half being stronger for Variperm oil, sands activity, etc. Is that still the outlook? Is there any update, given the fluctuations we've seen in crude price?

是的。太棒了。今年早些時候，您談到下半年 Variperm 石油、沙礦活動等會更加強勁。鑑於我們看到的原油價格波動，有任何更新嗎？

We don't really see a change in that outlook. It's something we'll monitor.

我們並沒有真正看到這種前景發生變化。這是我們會監控的事情。

We don't really see a change in that outlook. It's something we'll monitor. I think with those projects there and the drilling schedule could something shift from Q4 into Q1. I think that's possible. But right now, really no change in our outlook for oil, sands development.

我們並沒有真正看到這種前景發生變化。這是我們會監控的事情。我認為，有了這些項目，鑽探計劃可能會從第四季度轉移到第一季。我認為這是可能的。但目前，我們對石油、砂石開發的前景確實沒有改變。

Okay. So second half better than first half, and the first half here has been a little bit better than you thought.

好的。所以下半場比上半場好，上半場比你想像的好一些。

Correct.

正確的。

Good. That's a nice start for that acquisition. I wanted to shift over if we could, to the balance sheet. And so while I think I heard you saying, can you just walk us through the note redemption process. We know its $60 million but you've said August several times. Is there a specific date here? And then how do we fund that? Do we fund it? Do we pull cash balances down a little bit more? Do we bump the revolver up? How do you see kind of processing that paydown?

好的。這是此次收購的良好開端。如果可以的話，我想轉移到資產負債表上。所以，雖然我想我聽到你說，你能引導我們完成票據兌換過程嗎？我們知道它是 6000 萬美元，但你已經多次提到 August。這裡有具體日期嗎？那我們要如何資助呢？我們資助它嗎？我們是否會進一步減少現金餘額？我們要舉起左輪手槍嗎？您如何看待付款的處理方式？

No. Thanks for the question, Dan. Basically, we're a little bit ahead of our process and that we did retire, we did redeem or buyback, sorry, $13 million worth of notes in the second quarter, did that with cash on hand in our revolver. The $60 million specifically in mid-August, our indenture of the notes requires a 30-day notice period to redeem notes. So on July 17, we issued that redemption notice for $60 million. We'll redeem those on August 16 for that first $60 million.

不。謝謝你的提問，丹。基本上，我們的流程有點超前，我們確實退休了，我們確實贖回或回購了，抱歉，第二季度價值 1300 萬美元的紙幣，是用我們左輪手槍裡的現金做到的。特別是在 8 月中旬，我們的票據契約要求 30 天的通知期才能贖回票據，具體金額為 6,000 萬美元。因此，我們在 7 月 17 日發布了 6000 萬美元的贖回通知。我們將在 8 月 16 日贖回首批 6,000 萬美元。

When we think about where the funding is going to come from that, it's going to come a little bit out of cash flow in the third quarter and a little bit with addition on to our revolver. And importantly, we ended the second quarter with $135 million of total liquidity, and that's cash plus availability of our revolver. So we've got a lot of dry powder there and would be able to redeem those notes with that, do a similar process in the fourth quarter to get the rest of those '25 million notes redeemed by the end of the year.

當我們考慮資金將從哪裡時，第三季的現金流將會有一點，我們的左輪手槍也會有一點。重要的是，第二季末我們的總流動資金為 1.35 億美元，這是現金加上我們左輪手槍的可用量。因此，我們在那裡有很多乾粉，可以用它來贖回這些票據，在第四季度執行類似的流程，以便在年底前贖回剩餘的 2500 萬張票據。

And Lyle, is there a similar redemption notice process. So you issued a press release saying, hey, we're going to redeem the remainder. And so we will follow the same process? We'll see something in October, November and that redemption that would follow 30 days later.

還有萊爾，是否有類似的贖回通知流程。所以你發布了一份新聞稿說，嘿，我們將贖回剩餘的資金。那我們會遵循相同的流程嗎？我們將在 10 月、11 月看到一些事情，以及 30 天後的救贖。

It would, Dan. That would be the similar process.

會的，丹。那將是類似的過程。

Okay. Good. That’s helpful. And then my last question and it's one more focused on operations. Your valve business, you had a nice bump. Can you talk a little bit was that. Is that a restocking by distributors? Was it the Middle East growth that drove that? I'm just curious if we're seeing a change in business dynamics.

好的。好的。這很有幫助。然後我的最後一個問題更側重於營運。您的閥門業務取得了不錯的進展。能簡單說一下嗎？這是經銷商補貨嗎？是中東的成長推動了這一趨勢嗎？我只是好奇我們是否看到業務動態改變。

No change in business dynamics, no restocking by distributors. This is more project deliveries in both the US and in Arabia. So, pleased with the kind of trend we're seeing in Saudi, I think it's gone well. And so we'll keep that up. But no real change in the valve industry dynamics there.

業務動態沒有變化，經銷商也沒有補貨。這是在美國和阿拉伯半島交付的更多項目。因此，我對我們在沙烏地阿拉伯看到的趨勢感到滿意，我認為進展順利。所以我們會繼續這樣做。但閥門產業的動態並沒有真正的變化。

Thanks. And I said it was my last question. I do have one more. Kind of every other quarter I asked you about the environment for bolt-on acquisitions and opportunities. Variperm, obviously, you're early in that process still, but things seem to be going well. What's the overall environment for things like another Variperm or opportunities? And as you're answering that question, I guess, North America is sloppy right now. Would you stay away from North American exposure or do you think about North America as an opportunity?

謝謝。我說這是我的最後一個問題。我還有一個。每隔一個季度我都會向您詢問有關補強收購的環境和機會。Variperm，顯然，你還處於這個過程的早期，但事情似乎進展順利。另一個 Variperm 或機會之類的整體環境是什麼？當你回答這個問題時，我想北美現在很草率。您會遠離北美市場還是認為北美是一個機會？

Yeah. Good. So I think obviously, Variperm for us was a home run right value margin. I’d love to find another one. Those will be hard to find. We’ll continue to look. I think that the overall environment though, there are opportunities out there. I think activity is robust. The deals seem to be getting done. And with our kind of breadth of product lines and our geography diversity, we can kind of hit both the US and international.

是的。好的。所以我認為顯然，Variperm 對我們來說是一個本壘打，正確的價值邊際。我很想找另一個。那些將很難找到。我們將繼續尋找。我認為整體環境還是有機會的。我認為活動很強。交易似乎即將完成。憑藉我們廣泛的產品線和地理多樣性，我們可以同時衝擊美國和國際市場。

We’re not running away from the US I think ideally would want to find a business that would have both a US and an international presence. And so we’ll continue to look for that. But really, our criteria, though, is we want to find the strong industrial logic, where it fits in our portfolio, and we’re going to be conservative with the leverage on our balance sheet going forward.

我們並沒有逃離美國，我認為理想的情況是希望找到一家既在美國又在國際上開展業務的企業。因此，我們將繼續尋找這一點。但實際上，我們的標準是我們希望找到適合我們投資組合的強大的工業邏輯，並且我們將在未來資產負債表上的槓桿方面保持保守。

Okay. Thanks so much. Well done.

好的。非常感謝。幹得好。

.Thank you, Dan.

.謝謝你，丹。

Jeff Robertson, Water Tower Research

傑夫羅伯遜，水塔研究

Thanks. Good morning. Neal, you spoke a little bit about revenue per rig. And I'm wondering if you can talk both between the US and international markets.? Where do you see further gains in the type of sales mix that will offset the weakness you see in the rig count? And then secondly, are those gains pretty sticky if you start to see some sort of improvement in rig count in 2025?

謝謝。早安.尼爾，您談到了每台鑽孔機的收入。我想知道您是否可以談論美國和國際市場。您認為銷售組合類型的進一步增長將在哪些方面抵消鑽機數量的疲軟？其次，如果你在 2025 年開始看到鑽機數量有所改善，那麼這些收益是否相當黏性？

Yes. Good question. So yeah, I think in the US, we have methodically increased our revenue, let's call it, US revenue per US rig. If we were to estimate, we're probably up 4% or so year-over-year, and that would truly be market share gains. I think, with about 75% of our sales being activity-based driven in my experience, our experience with the business we have that once you get in with that customer and you deliver, you do have some stickiness, right?

是的。好問題。所以，是的，我認為在美國，我們有條不紊地增加了我們的收入，我們稱之為每台美國鑽機的美國收入。如果我們估計的話，我們可能會比去年同期成長 4% 左右，這才是真正的市佔率成長。我認為，根據我的經驗和我們的業務經驗，我們大約 75% 的銷售是基於活動驅動的，一旦你與該客戶接觸並交付，你確實有一定的粘性，對嗎？

And you understand their needs, what they value and you can have the product ready for them and you can deliver on time. And those are really key points. So yeah, I think our expectation and the challenge we're going to put to our teams is not only do we need to hold those customers, we do need to grow it as the market rebounds.

您了解他們的需求、他們的價值，您可以為他們準備好產品並按時交付。這些都是真正的關鍵點。所以，是的，我認為我們的期望和我們將為我們的團隊帶來的挑戰不僅是我們需要留住這些客戶，而且我們確實需要隨著市場反彈而擴大客戶數量。

Are some of those gains driven by the service providers wanting FET's products or is it a mix of that plus the E&P operator or the well owners saying if you're going to drill our well, we want these types of products on site for that FET supplies?

其中一些收益是由需要FET 產品的服務提供者推動的，還是兩者兼而有之，加上E&P 運營商或井主說，如果您要鑽我們的井，我們希望在現場為FET 提供這些類型的產品補給品？

Yeah. I think it's a good combination of both. So we do see pull-through from the E&P to the service company for certain products we have that helped the service company increase their productivity. About half of our sales are directly to E&P operators already. So we're able to put that value proposition directly to them. So combination of both our strategy is we want to differentiate. We want to deliver technology and solutions that make our customers more efficient. So the better we are at laying out that value proposition, the more often we're going to grow that share.

是的。我認為這是兩者的良好結合。因此，我們確實看到我們擁有的某些產品從勘探與生產到服務公司，幫助服務公司提高了生產力。我們大約一半的銷售額已經直接面向勘探與生產業者。因此我們能夠直接向他們提出價值主張。因此，我們希望結合兩種策略來實現差異化。我們希望提供能夠提高客戶效率的技術和解決方案。因此，我們越能更好地闡述價值主張，我們就越能增加這一份額。

And on renewables or energy transition, you mentioned power generation as a potential new revenue opportunity in your JumboTron XL system. Is that because you're seeing requests for bids and people doing fabrication studies? Or are you actually starting to see orders for products to build out these types of systems around the world?

關於再生能源或能源轉型，您提到發電是 JumboTron XL 系統中潛在的新收入機會。這是因為您看到了投標請求和人們在進行製造研究嗎？或者您真的開始看到在世界各地建立此類系統的產品訂單？

Yeah. So we have delivered these sales already last year and this year. But what's exciting to us is the pipeline does seem to be expanding really rapidly. And I think just as maybe more of an industry comment that as these data centers are being built out, and there just seems to be a lot of concern about where the power is going to come from. So we're seeing more of that, let's call it, mobile power gen being utilized in different applications. So we're seeing that bid activity directly, and we've seen a really big spike. Again, these projects do take time, but we see that as a long-term growth driver for us.

是的。所以我們去年和今年已經實現了這些銷售。但令我們興奮的是，管道似乎確實在迅速擴張。我認為，也許更多的是行業評論，隨著這些數據中心的建設，人們似乎對電力的來源有很多擔憂。因此，我們看到更多的行動電源被用於不同的應用。因此，我們直接看到了出價活動，而且我們看到了一個非常大的高峰。同樣，這些項目確實需要時間，但我們認為這是我們的長期成長動力。

And then to follow on that, do those types of projects create aftermarket business through servicing and replacement cycles?

接下來，這些類型的項目是否透過維修和更換週期創造售後業務？

They do. Our units are really robust. So they do last a long time. And so I think it's a longer service cycle for us. But once that unit is in place, it will run for a decade. And so we'll have a tail to that. It will be a couple of years before we see any aftermarket from it. But once that's installed, we got a long tail there.

他們確實這麼做了。我們的單位非常強大。所以它們確實可以持續很長時間。所以我認為這對我們來說是一個更長的服務週期。但一旦裝置到位，它將運作十年。所以我們會有一個尾巴。我們還需要幾年時間才能看到它的售後市場。但一旦安裝完畢，我們就得到了一條長尾巴。

And then a last question. On the Middle East and your revenue growth in the second quarter, are you seeing projects or big-scale projects that you see that continuing in not necessarily the quarterly growth, but are you seeing continued exposure for increased sales as you look out into 2025 and maybe even 2026?

然後是最後一個問題。關於中東和第二季度的收入成長，您是否看到一些專案或大型專案不一定會持續季度成長，但展望 2025 年，您是否看到銷售額持續增加？

Yeah. I was actually just sitting with one of our Middle East sales leaders yesterday and talking with him and he sees a good pipeline, and I agree into '25 really no change to the trend. And so we'll continue to benefit from that. And I still think there's a lot of opportunity there for us to, again, keep exporting not only the unconventional technology, but our downhole technology as well.

是的。事實上，我昨天才剛和我們的一位中東銷售領導坐在一起，與他交談，他看到了一個很好的管道，我同意進入 25 年，趨勢確實沒有變化。因此，我們將繼續從中受益。我仍然認為我們有很多機會，不僅可以繼續出口非常規技術，還可以繼續出口我們的井下技術。

Just on margins, Neal or Lyle, with the 12.5% to 13% margins in the first two quarters of this year. Do you think the product mix as you think about 2025 will be similar to 2024 can lead to the similar type margins or do you think there’s room for expansion?

就利潤而言，尼爾或萊爾，今年前兩個季度的利潤率為 12.5% 至 13%。您認為 2025 年的產品組合是否會與 2024 年類似，從而帶來類似的利潤率，或者您認為還有擴展空間嗎？

Yeah. I’ll work on that Jeff. If you look at our overall margins, they’ve been relatively flat post the acquisition, post the integration of Variperm, which gave us a really nice boost and you mentioned mix. But clearly, in my comments, we talked a lot about mix being the driver. And so that is something that we’re looking at. I think where we can control mix and influence mix is with our market share gains that we have.

是的。我會處理那個傑夫。如果你看看我們的整體利潤率，在收購、整合 Variperm 後，它們一直相對持平，這給我們帶來了非常好的推動，你提到了混合。但顯然，在我的評論中，我們談論了很多關於混合作為驅動因素的問題。這就是我們正在關注的事情。我認為我們可以控制組合並影響組合的地方是我們所獲得的市場份額。

So take, for example, artificial lift and downhole sequentially, incremental EBITDA margins were about 37%. We talked a little bit earlier about Variperm. Their revenue was down just slightly. So call it roughly flat, but their overall profitability was up quarter-on-quarter. We also talked about our other downhole products being stronger. Those come at a nice healthy margin, offset a little bit by softer margins with valves.

因此，以人工舉升和井下業務為例，增量 EBITDA 利潤率約為 37%。我們之前討論過 Variperm。他們的收入略有下降。因此，可以說大致持平，但他們的整體獲利能力則是環比上升。我們也談到我們的其他井下產品變得更強。這些產品的利潤率相當健康，但被閥門的較軟利潤率所抵消。

So as we continue to grow downhole product line with share gains, I think that will be a boost and a tailwind to our margins. The other tailwind that would come is through operating leverage. So our revenues have been decently flat with the market activity coming down. But if we get that turn and we can see a run up in revenues, we could benefit our margins will benefit from operating leverage as well. So a couple of levers that would make those go higher in the future.

因此，隨著我們繼續擴大井下產品線並增加份額，我認為這將是我們利潤率的推動和推動力。隨之而來的另一個推動因素是營運槓桿。因此，隨著市場活動的減少，我們的收入基本上持平。但如果我們實現這一轉變，我們可以看到收入的成長，我們的利潤率也將受益於營運槓桿。因此，有幾個槓桿可以讓這些未來走得更高。

Thanks very much.

非常感謝。

Thank you, Jeff.

謝謝你，傑夫。

Eric Carlsson

埃里克·卡爾森

Another great quarter. I mean it's hard to complain when you can almost generate 25% of your market cap in cash in a whole year, which I think the international markets are probably a little bit underappreciated by the market currently, but maybe just a little bit more on Canada and when you think about activity there. I guess Baker Hughes 144 oil-specific rigs currently, which is, I mean, maybe 20-plus percent above last year. And could you maybe just share a little bit on when you think about Canadian activity, obviously, am I correct in thinking that being more oil-weighted is a benefit to Variperm specifically?

又一個偉大的季度。我的意思是，當你一整年幾乎可以產生 25% 的市值現金時，就很難抱怨了，我認為目前國際市場可能有點被市場低估，但加拿大可能會更多一點。活動時。我猜貝克休斯目前有 144 個石油專用鑽井平台，我的意思是，這可能比去年增加了 20% 以上。當您考慮加拿大的活動時，您能否分享一下，顯然，我認為增加石油權重對 Variperm 特別有利，這種想法是否正確？

Yeah, absolutely. There's a certain percentage of those rigs that you mentioned that work in the oil sands. And so it's timing of those wells that are being drilled. And so I think Variperm, when we did the acquisition, we felt had a long-term run rate there, not only with new projects, but as the fields would be, let's call it, infill drill, just to keep up with the decline rate just to stay flat, they would need to keep utilizing their product.

是的，絕對是。您提到的這些鑽孔機中有一定比例是在油砂中工作的。因此，現在是正在鑽探的油井的時機。所以我認為，當我們收購 Variperm 時，我們覺得那裡有一個長期的運行速度，不僅是新項目，而且是油田，我們稱之為填充鑽，只是為了跟上下降的步伐為了保持穩定的利率，他們需要繼續使用他們的產品。

And then maybe the other part of that is the newer wells today typically have longer laterals and require more units of Variperm product per well. So I think that's another secular trend that we're pleased to see. So you have more oil rigs in Canada should absolutely help Variperm.

也許另一部分是當今較新的井通常具有更長的支管，並且每口井需要更多單位的 Variperm 產品。所以我認為這是我們很高興看到的另一個長期趨勢。因此，加拿大擁有更多的石油鑽井平台絕對會對 Variperm 有所幫助。

Great. And then maybe just on that longer lateral comment in the industry broadly. I mean, obviously, when you think about kind of the business lines you have, if you look in to any of the E&P calls, you hear basically longer laterals, more stages completed per day. And when you think about like a 4 mile lateral versus a 2 mile lateral, obviously, you need less rigs to complete that work, but the intensity of those rigs and the materials are there.

偉大的。然後也許只是行業內較長的橫向評論。我的意思是，顯然，當你考慮你擁有的業務線時，如果你查看任何勘探與生產電話，你會聽到基本上更長的支線，每天完成的階段更多。當你考慮 4 英里橫向與 2 英里橫向時，顯然，你需要更少的鑽孔機來完成這項工作，但這些鑽孔機和材料的強度就在那裡。

So when you think about just building product mix for the future as technology continues to improve. I mean, do you think about how do we benefit from more stages complete or, call it, lateral miles drilled or whatever that may be. And we'll get less on kind of the pure rig count number? Can you just provide some thoughts around that?

因此，當您考慮隨著技術的不斷進步而為未來建立產品組合時。我的意思是，您是否考慮過我們如何從更多完成的賽段中受益，或者稱之為橫向里程訓練或其他任何可能的東西。我們會得到更少的純鑽機數量嗎？您能否就此提供一些想法？

Yeah. No, you hit it right on the kind of the trends that we see. I think we generally refer to rig because it's published weekly. It's something everyone has access to. We internally track, we track stages, we track wells. There's a little bit of a lag in the data. So it makes it hard to be forward-looking. But, our focus is really the service intensity. So as you made a mention of longer laterals. So that would be the lateral gets longer, the coiled tubing string is longer. So that's more revenue per string. The wireline string is longer. So that's more revenue per cable.

是的。不，你正好抓住了我們所看到的趨勢。我認為我們通常提到 rig 因為它每週發布一次。這是每個人都可以訪問的東西。我們進行內部追蹤、追蹤階段、追蹤油井。數據有一點滯後。因此，很難具有前瞻性。但是，我們的重點實際上是服務強度。正如您所提到的較長的側支線。那麼就是側管變長，連續油管柱也變長。所以每根弦的收入更多。電線串較長。因此，每條電纜的收入更高。

As you pump more stages per day, you're going to wear out your power ends, you're going to wear out your flexible hoses more quickly this year than you did the year before. So you're going to see increased replacement cycle. So all that will be will benefit us. So yes, you're right, rig count maybe isn't the best view of our business. But over time, we're going to increase our US revenue per US rig. And I think we said about 4% or so already, and we'll continue to improve on that as time goes forward.

當您每天泵送更多級時，您的動力端將會磨損，今年您的柔性軟管也會比前一年更快磨損。所以你會看到更換週期增加。因此，所有這一切都將使我們受益。所以，是的，你是對的，鑽孔機數量可能不是我們業務的最佳視角。但隨著時間的推移，我們將增加每台美國鑽機在美國的收入。我認為我們已經說過大約 4% 左右，隨著時間的推移，我們將繼續改進這一點。

And then maybe you can just share a little bit more info on kind of the Middle East specifically. Obviously, you see a lot of unconventional gas announcements and looking into kind of the other service providers, they expect to deliver rigs into the Middle East? And maybe just, I don't know, like what is the market opportunity there? And I even saw like the announcement, I think there was a post somewhere where you guys kind of are going to manufacture the radiators within the Saudi Arabian facility now maybe correct me if I'm wrong.

然後也許你可以分享更多關於中東的具體資訊。顯然，您看到了很多非常規天然氣公告，並研究了其他服務提供商，他們希望向中東提供鑽井平台？也許只是，我不知道，例如那裡的市場機會是什麼？我什至看到了這樣的公告，我認為在某個地方有一個帖子，你們將在沙烏地阿拉伯的工廠內製造散熱器，如果我錯了，也許可以糾正我。

Can you provide some content to the market opportunity there? I mean obviously, numbers are way above pre COVID, so you guys are kind of executing there. But does that become I mean, is that the biggest growth potential and then all incremental US activity that becomes a ton of torque to the outsider? I guess how do you think about the product mix geographically going forward?

您能為那裡的市場機會提供一些內容嗎？我的意思是，顯然，數字遠高於新冠疫情之前的水平，所以你們正在那裡執行。但這是否會成為我的意思是，這是最大的成長潛力，然後所有增量美國活動都會對局外人產生巨大的影響嗎？我想您如何看待未來的地理產品組合？

I think your last comment there was really real spot on that we do see, let's say, long-term growth in the Middle East. If the US and Can the US were to return back to, let's call it, more normal levels, we would see a ton of torque. Historically, in Middle East was maybe less service-intensive, so you didn't see the types of sales per rig that maybe you would see in the United States.

我認為你最後的評論非常真實，我們確實看到了中東的長期成長。如果美國和美國能夠回到更正常的水平，我們會看到大量的扭矩。從歷史上看，中東的服務密集度可能較低，因此您看不到在美國可能會看到的每台鑽孔機的銷售類型。

However, that is changing, and you mentioned our radiator manufacturing that we're looking to conduct. We are conducting in Saudi. They are starting to drill unconventional wells in a big way, that's going to use a lot of coil. It's going to use a lot of wireline. It's going to consume a lot of power ends, and they're going to require new radiators, the newest types of radiators for their frac fleets there.

然而，這種情況正在發生變化，您提到了我們正在尋求進行的散熱器製造。我們在沙烏地進行。他們開始大規模鑽探非常規井，這將使用大量線圈。它將使用大量的有線線路。它將消耗大量的電力端，他們將需要新的散熱器，為他們的壓裂車隊提供最新類型的散熱器。

Eric, we are bullish about the Middle East. We're also bullish about the offshore markets and our subsea business. So if you think about that business and one of the big drivers that everyone watches is subsea wellheads or subsea tree orders and subsea tree orders have been up and strong.

艾瑞克，我們看好中東。我們也看好離岸市場和海底業務。因此，如果你考慮這個業務，每個人都關注的主要驅動因素之一是海底井口或海底採油樹訂單，而海底採油樹訂單一直在增長且強勁。

We mentioned last quarter, we're seeing higher and higher utilization of the existing ROV fleets which is a big driver for us initially, that's driving spare parts. Our pipeline of new inquiries for incremental ROVs to add to our customers' fleets is meaningful. So we're excited about that as well as opportunities in the defense sector. So while we do see a lot of excitement around the Middle East, we also see opportunities coming on the subsea side as well into next year.

我們在上個季度提到，我們看到現有 ROV 船隊的利用率越來越高，這對我們來說最初是一個很大的推動力，即推動備件。我們對增量 ROV 添加到客戶船隊中的新詢問管道是有意義的。因此，我們對此以及國防部門的機會感到興奮。因此，雖然我們確實看到中東地區有很多令人興奮的事情，但我們也看到明年海底領域也將出現機會。

Okay. Great. That’s all. Very helpful.. And then, I guess this is my last question, last comments and just kind of one of your thoughts. I mean we're a little bit ways away, but it's getting closer. And when you think about kind of the potential to return capital, I guess I would just encourage you, if you're trading at a 25% free cash flow yield and a 50% discount to your peers on an EBITDA multiple basis to put every dollar possible to buying shares. Now obviously, if the market reprices you, dividends are great and then using share repurchases to either increase free cash flow per share or the ability to pay dividend per share without increasing the cash outlay. That's great.

好的。偉大的。僅此而已。非常有幫助..然後，我想這是我的最後一個問題，最後的評論，也是你的想法之一。我的意思是我們還有些距離，但已經越來越近了。當你考慮資本返還的潛力時，如果你以 25% 的自由現金流收益率進行交易，並且在 EBITDA 倍數基礎上比你的同行有 50% 的折扣，那麼我想我只會鼓勵你美元可以購買股票。現在顯然，如果市場重新定價，股息會很大，然後使用股票回購來增加每股自由現金流或在不增加現金支出的情況下支付每股股息的能力。那太棒了。

But at current valuation, I would pound the table on buying factor shares. And if that reduces liquidity or whatever it may be, it's kind of irrelevant from a long-term shareholder standpoint. So I just kind of like your internal comments of where your kind of valuation sits relative to peers. I mean, obviously, this is hypothetical because you can't do it at this point in time. But if you could return capital to shareholders, like what are your guys have thoughts once you get to that point?

但以目前的估值，我會積極買進要素股。如果這會減少流動性或其他任何可能的因素，那麼從長期股東的角度來看，這有點無關緊要。所以我有點喜歡你的內部評論，也就是你的估值相對於同業的情況。我的意思是，顯然，這是假設的，因為你目前無法做到這一點。但如果你可以將資本回饋給股東，那麼一旦你達到了這一點，你的人會有什麼想法？

Great question. And as Neal mentioned earlier, we're working through that process, but we see the same thing that you do. With our free cash flow yield that we have is tremendous. There's not many companies that have that as an opportunity. And part of that is because our valuation on a multiple basis is less than a lot of similarly situated companies. So I think either way, either that multiple recovers, and we're pleased with that and/or we have an opportunity to retire shares, buy back shares that would be really strong. So things that we would definitely look at, like you mentioned, we'll come up with that plan and share that when we get closer.

很好的問題。正如尼爾之前提到的，我們正在完成這個過程，但我們看到了與您所做的相同的事情。我們擁有的自由現金流收益率是巨大的。沒有多少公司有這樣的機會。部分原因是我們的多重估值低於許多類似情況的公司。因此，我認為無論哪種方式，要么倍數恢復，我們對此感到滿意和/或我們有機會退役股票，回購非常強勁的股票。所以我們肯定會關注的事情，就像你提到的那樣，我們會提出這個計劃，並在我們接近時分享。

Great. Well great quarter. Thanks, guys. Appreciate you taking the question.

偉大的。嗯，很棒的季度。謝謝，夥計們。感謝您提出問題。

Thanks, Eric.

謝謝，埃里克。

Thank you. At this time, I would now like to turn the conference back over to Neal Lux for closing remarks.

謝謝。現在，我想將會議轉回尼爾·勒克斯 (Neal Lux) 致閉幕詞。

Thank you again, Gigi, and thank you for your support and participation on today's call. We look forward to talking to you all again in early November to discuss FET's third quarter 2024 results.

再次感謝您，Gigi，並感謝您對今天電話會議的支持和參與。我們期待在 11 月初再次與大家交談，討論 FET 2024 年第三季的業績。

This concludes today's conference call. Thank you for participating. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。