Nabors Industries (NBR) 24 Jul 242024 Q2 Earnings call transcript

Good day, and welcome to Q2 2024 Nabors Industries Limited Earnings Call. [Operator Instructions]. Please note, this event is being recorded. I would now like to turn the conference over to William Conroy, Vice President of Corporate Development and Investor Relations. Please go ahead, sir.

Good morning, everyone. Nabors XXXX joining Conference for you Second Earnings Quarter Call. Thank our format will Executive Petrello, Restrepo, with providing insights follow how results, we markets. markets expect the with: perspectives Officer; Financial on their our William into Chief Today, these along and Nabors customary Tony to quarter's in Officer; President our and and our Chief we Chairman, perform Investor both Relations these remarks, of and a as available, a of is webcast download support In in deck the section nabors.com. the within slide Instructions replay the this to are website are Senior call as and addition the other William for in Management of the posted team. members of well. With on us Tony, me, today, will Securities Since XXXX. Securities of expectations, our the forward constitute Exchange of the much today they and XXXX Act meaning of Act our of the include forward-looking commentary may statements within forward-looking uncertainties and Commission. our with certain the statements Securities time-to-time as disclosed to are Exchange in Such Nabors from filings risks and subject by

vary indicates in William mean in measure is and actual to non-GAAP financial flow. As a during either and income, certain EBITDA our during word adjusted references the is release. that cash our non-GAAP we their otherwise, cash on presentations, the earnings flow to adjusted our website free discuss earnings result as may clearly forward-looking may such whether or adjusted EBITDA context term or otherwise, implied references by qualified the defined cash of those flow by as unless defined as our adjusted mean adjusted that release. Likewise, call, statements. Also, measures All these results or by free EBITDA indicated debt, materially made operating adjusted net factors, Tony such from

of turn the financial website a call posted these will over to GAAP Tony I most measures. With Investor our the the of begin. Relations section to comparable recently non-GAAP to to have that, measures We reconciliation

joining us Thank Good today. for morning. you

Nabors employees I It strong Hurricane to testament path. their maintain to have employees, impacting to conditions our situations, of able homes. to want I especially begin, been A the all time. suffered for acknowledge our difficult their this is to continuity. would Burroughs thank operational I communities facing personal in those staff that number we damage Before like efforts during a have the challenging of

industry XX continues levels. Nabors record performance and we I'll quarter. rigs activity summary, begin during considerable industry X with and declined quarter has roster margins rig XX by Solutions Nabors to high rig stable. X%. rigs markets. X% industry deployments. broad for rig our the the count EBITDA over margins first in XX Total its Drilling is segment comments adjusted start Now, XX the quarter. reach, leading declined. our remained of our XX near the industry remainder at approximately total Notwithstanding count pricing more reached EBITDA million count adjusted in Lower looking exceeded line of rig results detailed in in rig of been Lower XX the Lower average our on of Lower were the when this In strong. at outlook. daily environment. rig the the in as U.S. expectations. Demonstrating incremental second the support Margins capitalizing in The successful the Lower performance, in outperformed to with We've pricing rigs, or land our number Daily decreased this essentially once our will my international quarter. rig second in seen detail our deploy segment on remarks its international awards international and moments, a incremental expansion edge XX. I count The remains the second own strength evident international deployments. with few $XXX I'll XXXX. Lower by expect again The pending count industry Current

Our quarter. in line rig the previous essentially count was with global average

Nabors' Rig X tech rig cash international million. by Solutions flow quarter. previous Drilling average operations These from EBITDA $XX more and in increased XX% high the Technologies quarter. EBITDA segments combined count the increased accounted This high Our than of free rigs. for EBITDA generated of total a

comments Next, Drilling start X I our will our make with some key on drivers International of the results. I'll business.

markets. some That strongest the for market in strength said many years. is of have is I international evident XX have seen our As time, we across this

We and have negotiations. been recent tenders successful on

encouraged are enables This by opportunities. substantial us a environment remain of number We pending to selective. highly

objectives. earlier We X rig expect flow In or free in exceed rig the quarter. current are opportunities we our high to meet the start the quarter, Algeria, rig in award fourth that second cash deployed third the targeting return our of we

have We operators. the rigs toward deployment work we of in multiple Argentina. incremental rigs, which span announced These begun X earlier,

the for rigs of first The We end Lower XXXX. final quarter the of quarter rigs expect in to all fourth X X the utilize Argentina idle operations from XXXX, the and the around commence XX. first in the one will X

the X requires announced in the Middle we second Arabia, In finished sixth rigs. In were start in eighth The well the of newbuild all year. should in and for the a quarter. beginning addition, the quarter expect now At market large X is and skilled important are X in another Kuwait XXXX starting SANAD point, early we XXXX. A X the in on ago, are It an say expected seventh of now and XXXX. fourth began more in acceptance procedure These high-spec in-country. Each are ninth its Drilling we Nabors' first content strengths. spun formal targeted crews. the market. challenging rigs drilling quarter July. Saudi shortlisted its of received have equipment We and Solutions work we The can for substantial for rigs newbuilds during East. the this in and deployment at currently this Kuwait of rigs awards is for

positioned capitalize well on there. demand increasing are to We

international I is even report in we will well on EBITDA. developments, the more optimism our clear confident this drove am these quarter, several progress second In it the With sequential our front. placed. was prior improvement markets

more Colombia normal Our unrest performance first Arabia in quarter. a the Algeria, returned experiencing some Saudi well. as in operation improved labor and Kuwait after to

finish Saudi Saudi by little natural SANAD's XX% drilling as gas, color and Aramco's recently a me overall in Aramco Today, announced we more and are specced rigs actively for production. SANAD, giving activity for Arabia. historically of billion approximately $XX of of have recently development natural Let our more on gas awards supported the contract Nabors gas. through

expectations. resilient. U.S. our for rig market remains XX our Next, in Daily margins I'll fleet rigs performance discuss in Lower rig the exceeded our our slightly The

the focus market same quarter performance. end, values remains the time, the of on the to rig automation continue portion From discipline own We our and count the start the of pricing that priority. to industry. outperformed At second our the

rigs. on results Our the just significant reported I'll moments. Lower the of margin NDS XX few generated more margin financial of discuss a reflects that. this in top daily rig detail in

me let our and technology innovation. Next, discuss

solutions. to Pressure U.S. was to EBITDA Solutions and exceeded on driven This NDS success beyond international sequentially our primarily gain Drilling Managed growing Drilling EBITDA digits. market. demonstrates revenue business were traction Our international NDS' performance Drilling The Overall, rigs. NDS our our continues up growth Managed the by Pressure extend by expectations. and each double

Of contributed was equal margin the our marks per from I'll quarter, NDS $XX,XXX the quarter. Solutions in businesses discuss second combined day. quarter. NDS the Next, average on first second Drilling XX first and NDS rigs Lower the the Penetration XX to The second slight performance high that, a This in Lower daily was Penetration markets, Drilling in over $X,XXX quarter. of increase the quarter. Nabors' remained specifically.

results count. due overall to rigs in Nabors in However, decline were Nabors' muted the rig

Pressure and specific In Pressure NDS of in services, Managed Drilling. volume terms increases saw Drilling Managed

in validate a the the the third-party quarter second to This our results effects market. strategy enables rig on the us U.S. for sideways of to continued Our focus offset focus count

on our Next, let make structure. some me capital comments

the financing This X maturity weighted cash our more quarter, proceeds, During flow X-year quarter the X.X than our extends credit free $XXX and In of existing average by recently, from we we net facility. maturity quarter, retire its those generated years second issued in due today. and by second We With reduced million the notes notes. last the expanded to facility to years. intend debt. More X.X we extended X XXXX. year, amended we

reducing this priority part Our debt. I'll on remarks finish of remains sustainability. the discussion with

operational the on transition and Technologies initiative unit impactful emissions. most rigs The power running savings reduces the This quarter, operators It improving second portfolio ET consumption these in the PowerTAP. as connects to readily remains where results solutions PowerTAP performance to focuses grid energy related reducing as by grid. significant Rig realize contribution emissions, Our available, In a module. notable well segment. our diesel is our made fuel

the in U.S., demonstrate and opportunity performance see the savings internationally. With we we growing

of the U.S. first the in expect by top international We our units U.S. beyond strong deployed interest. are the year. end in Traction Transition Energy the to in X have operators gaining portfolio the remains our that, markets of On

discuss will I environment. pricing the Next, rig

market Our remains second our focus on discipline in with in leading-edge Lower continued pricing showed XX excellence, resiliency results pricing a quarter operational the mantra.

the to this we portfolio work. And where Lower role at we volume, signs They to seeking rig be still the that have Latin firming. These the end than adding MENA activity, Asia, we countries when near-term XX you clients are across increasing With more the international Our additional work comes with of as are an this of visibility rigs. pricing the currently would or market, can consider Drilling important XX surveyed and are awards. plays tender Solutions in it We attractive. spread quarter. Those America. in including geographies showing In markets is approach. expect, largest second we selective

at activity activity. than operators for the the lower indicates the industries quarter. XX relates in the modestly involved of levels. covers count project Group's operators, survey accounted the announced second year-end current this working XXXX not at survey all Essentially rigs total the which latest Lower rig decline to of of merger projected XX% XX end approximately will end to The quarter. at remain be mergers The the Our of

clients the exhibit churn. continue in the their time, high same from XXXX, we basins. remain believe level Aside of for particularly market about focused mergers, to At relatively to gas expected we that cautious the plans a

view the remains international market, bullish. our For

compared What track to rigs for count X rigs XX We we including in that, second X in of Kuwait. good is additional an already rig increase Saudi to satisfying end of the X XXXX. have namely in yields This is and the XXXX, are deployments, a XXXX. Argentina Arabia, scheduled half particularly X end rig X in visibility on in

extended award Mexico couple highlights advanced thread services to strong element This a provide in on X Casing installed our market. Gulf secure delivers the operator a System basis demonstrate major solidifies those third-party all years of these Nabors' of NDS Rig operators. share across contractors. contractors. solutions. These rig is additional of we highlights in X X quarter our installs different The our and SmartROS drilling from in release. announced NDS in deep the believe water A the will SmartROS, content the for this installations We technology contractors spectrum that of position I advanced with value press in the our X Next, Running on common We for addition units. to rigs of Operating technology the these

me exceeded following: Our the the Let my with expectations. second performance our remarks finish in quarter

the the industry-leading performance markets. technology markets. to across in At our deploying time, our deliver our are previously continues international We awarded advanced rigs same

discuss will me over who let William, the Now our financial results. turn call to

activity good segments the and below quarter increases Overall, EBITDA our and U.S. morning international all in as as were decline Drilling the Solutions the Technologies our Drilling general, was the Tony, well you, by almost of Drilling the our for segment reduction XX Thank quarter slightly market. segment. International results in forecast Rig in first as compensated offset Lower for everyone. In financial second

$XXX of our in prior prospects, rig quarter its operations We million the pricing in as from international $XXX our compared count growth future million the this second stability and well recent Lower strength and the resilience in are of by encouraged our activity was to for by quarter. market. Revenue as XX the the by

market or to due reductions up a primarily Our conditions said, That by segment the held drove Lower pricing U.S. $XX.X reduction. count Lower market. million, XX being well. current in by X-rig XX decreased X.X%, the sequential X.X% Drilling decreased rig as

This the fleet at in our first or $XX,XXX; by primarily increased $XXX driven also was an Pressure Drilling million, the in for the $X.X improvement a by increase mitigated by the deployment quarter. Revenue as by market. Saudi of from operations in with of our by million quarter. Revenue revenue. to hurt quarter, our Solutions the pricing. more growth daily market, by revenue second in additional Performance was X.X% challenges Running startup the adjustments third-party X segment for the in of grew segment in from U.S. announced of during a Algeria $X.X and quarter. International the was The U.S. rig This the downtime achieved XX% was we and Drilling work below in XX% impact only placement Our in driven Casing Managed recertification came Argentina in rig the in the improvement. rig Arabia linked our result sequential previously international Despite a and by count services. software our revenue this in the Lower increase decreased XX wellbore by

segment Rig the quarter this sales we aftermarket in more by the its Additionally, efforts equipment particularly by U.S. in XX% was NDS markets, revenue, below slightly to continue sluggish sales capital our were focus level growing revenue as strong than Technologies first as on International globally. compensated expanded

EBITDA $X.X in turning Lower the adjusted the reductions XX the X.X% million first activity million U.S. to million and driven by for $X.X Drilling of the primarily was to million, $XX $XXX drilling EBITDA million by decreased Now, or was down Total Lower in quarter. Outlook. of by the $XXX compared market. to EBITDA million, EBITDA $XXX quarter or the compared quarter. prior X.X%, XX

revenue levels the Our We rig quarter Lower low- the to $XXX The churn, was average exhibit in remains more The pricing impacted but XX X-rig rig rig forecast. came higher expected. daily to in our exited down count approximately market rigs. Average which we XX.X daily with than continues turn rigs. XX $XX,XXX, from to count. mid-XXs. X high somewhat our the in margins first XX in second operating reduction Lower quarter, at decreased than stable the Leading-edge of with

approximately range at Consequently, high have price for this point this daily been year leading-edge a levels. experiencing average We consistently now. our in held has revenue

utilization, rig rigs. Given a technology of the of pressure proposition strong fleet our on this high confirms value high specification, stability

XX For leading-edge new margins Lower below for rigs daily $XX,XXX, our in the will the as third contracts the quarter, to we come with our pricing fleet. average $XX,XXX and project somewhat roll between

combined a anticipated. EBITDA combined $XX.X and somewhat quarter, anticipate quarter. On million, count improvement. contract. We markets Alaska market off rig these slightly the In rolls the the this the for the should X XX% second businesses slight performed million EBITDA approximately season. also operations better approximately quarter, these in third typical than offshore decrease tick-up average smaller net X a basis, was for This offshore we In sequential of and for third $X.X to the U.S. a the by rigs is as X of

increase segment grew $XX,XXX, in an redeployed units of in Our with first first gross at delivered with second quarter and is results. rigs daily count which in $XXX.X the year. Average International impact came million. rig average Algeria the SANAD margin the line of of the Drilling International half X of newbuilds almost quarter a over million, in EBITDA X.X by X startup $X of the

average We count approximately quarter rig increase to expect X by rig. third the international in

contribution benefit Saudi During full the the period, newbuilds will startups of the Arabia. in we from X quarter

We expect the year to with totaling the newbuilds more X in fourth deployments SANAD X deploy XXXX for rigs. quarter, full

a targeting are Aramco the rigs Algeria, of deployed requested in by XXXX total quarter, into have already and third XXXX. rigs X X we In Another during startup for XXXX. deployment been in X rig for

startup also of U.S. from forward, units to in X Looking the the fourth we expect quarter redeployed Argentina a

be the grew We million its X.X% may quarter increase XX%. rolls idle The contract. new our one solutions in above project for was from by and quarter. some to of time second third $XX.X third quarter as the international EBITDA to rig quarter. Drilling $XX,XXX rigs offset adjusted partially market daily by and additions $XX,XXX in Gross between margin second margins NDS another just

Despite activity the margins to by grew revenue market during market, unfavorable wellbore international for placement continues meaningfully. lower of quarter the mix, affected expand. Our the the were U.S. an performance margin as current drilling our

on positive is focus results. penetrating Our international yielding markets

over sales, daily quarter. We quarter The $X.X compared by gross quarter X% day for more This second Solutions sequential Lower increase expect generated XX services Rig in our sought by businesses. transition a of for to the first a solutions aftermarket was activity. these our million near EBITDA was to reduce margin $X.X increase part pressures, These Drilling on X% repairs, level. NDS versus third approximately the decline primarily than $X,XXX, the Despite EBITDA increase capital to rentals rig the drilling first in to and improve quarter an X.X% EBITDA the Technologies third $XX,XXX. related costs. combined we million, improvement quarter. to expect gross U.S. strength Technologies as energy improvement international equipment and approximately of our and sales, to maintenance of offset took the Rig term operators margin per

cash to $XXX contributed Now drove in of free CapEx Newbuild, SANAD increase. generation, turning second expenses quarter. cash $XX second of to million, cash increase an totaled increase. first compares $XX and the to in million million. This million capital quarter payments liquidity in the lower the quarter. working the Improved most were total $X and interest for flow of cash sequential This flow free which the includes million $XX Capital

of $XXX $XX of the approximately We million billion. are our for million the at $XXX decreased $X.XX quarter to almost targeting CapEx debt reiterate $XXX year XXXX. Net between end quarter for the million and full by and million third expectation the

flow free $XXX between We and the $XXX XXXX. year continue to be on full million deliver track million of for to cash

XXXX facility $XXX in for in $XXX expires for $XXX expire we million of includes quarter, credit. credit that scheduled a and million million $XXX XXXX. facility letters million The the replaced that facility revolving with our to was During credit new

August $XXX A $XXX XXXX. feature Nabors this X.XXX% issued the of accordion of will with [ be notes $XXX improved a ] million significant to priority-guaranteed ] week the outstanding substantially proceeds was notes debt Additionally, maturing These upsized us million on transactions reduction used million. More [ priority-guaranteed provided profile in in to their exposure. transaction maturing recently, retire January in $XXX X in the have XXXX. million credit and XX,

when further mature. With turn notes our no concluding remarks. will until XXXX, to maturities priority-guaranteed have call that, the We senior Tony for his I

I William. you, remarks conclude Thank my will afternoon. now this

startups working we rig expect opportunities. all look ahead, today, These multiyear contracts. on over we be From we As will international XXXX. of see the X remainder significant

have an attractive for total should Their generate addition, deployments visibility XXXX we XX additional In returns. in XXXX. and economics financial

With well-defined these, cash a a in our flow. path we to growth business have significant and its secured international free

even ahead, for market presents rigs. Looking this opportunities with more us

Additionally, your looking environment. remarks Technologies reporting forward concludes to will that, Thank our am With this take Solutions on our and both are my time questions. today. we Rig for poised progress. That attention. I you Drilling businesses on capitalize to and your

comes [Operator Instructions] first the Hallead And from question Benchmark. today with Kurt

laid out guys clearly. quite everything You

the one caught of the particular, contrast to did that E&P really you you modestly I about your ] the in to think companies. U.S. positive the increase year. I to count throughout thing guess, provided related rig survey this is prospects And my for the commentary attention, that commentary that [

for that to are your of are curious to kind the the the So overall say, as market? rigs, relative what dynamics demand driving

some The last thing. -- let's the challenged. Well, very very on put market Obviously, context been quarter. has the U.S.

has down almost to you XX goal, our from maintain profitability our the count as been rig saw see And in pricing. the results, trying go rigs. You can

job So think we've real I that. a -- good and done of

focused customer. operational chased don't needs What of intend haven't we to. the the is excellence market following share we've and and really on We

put occurs a industry viability consolidation the it. I course, investors but of consolidation, the ET who the to what's the about of tries digested a this And as is of our have a that into for it's customer to and keep create I over you as of us year, think the the the And on there technology capitalize think also of new get us of making even end what's wider for that think One, really downside course they for given think we the market provides other rationalization also have a is been a talking these see prospects consolidation. to and opportunities mean, we've as rigs. effort And half to an also and a lot large happening on. type to makes profitable, of about. pretty new going is XXXX, have is we there we there's upside life lot life customer that our audience the more talk of we happen that, follow solutions, lot it isn't are that larger have think to of behind people know. I good a the -- our of that will as operators robust focus industry as players lot good on portfolio contractors, is for to are. And things which going

place also challenge to So for seen. maintain I and are do challenge, targeting and pretty our It's this a think is, far, that expecting ups a think we're the in and we're I while you've so we've for that's definitely done job good the But downs. short trying term, based what number quarter. -- results it's to there's in what on that now. conversations said that's a this We've right obviously quarter

color. basically the ] in debt [ to Looks have great. one that's related Great what like million you to said Okay, last million you cash quarter, obviously. about back the the think reaffirmed the to cash prospect, reduction? flow, $XXX maybe $XXX absolute out take debt free on you William, flow. dynamic how going then Maybe for free do the where full you William coming dynamics you're And Now of circle, about 'XXs. context

the proceeds the Kurt, we and the the that cash, the use to to pay debt. got from are that all down obviously, So, plans -- bond,

total generated cash We're down balance paying the that total going leave we to go sheet. debt, going So debt debt. applied as to to We're reduce not forward. to going be actual to all going reducing on be the that's the but will the cash is be

That's color. Appreciate awesome. Okay. that

Kutz Morgan Dan next from the question And comes Stanley. with

I I the I same ballpark offset the quarter. But just $XXX maybe each call, bogey EBITDA guidance could ballpark XX like some is have from third some ask, in about quarter and guess in fourth first first you wanted the somewhere about to quarter. the by be earnings have think of reported to half, fourth be if budget the the of I quarter. to international in year. the growth. was that guys in half thinking a maybe quarter on adjusted thought the of of be fourth quarter, kind growing seasonality some could for would then might EBITDA so your there Lower the maybe And exhaustion in could for before And it this the million maybe the the in sequentially that third be third sounds the good comments

the So consolidated of fourth I that's puts heading us the the was into just and wondering across so, year if just segments, you think quarter takes EBITDA could this some help directionally lines? and of about

Just schedule taking of in the fourth from rigs. those has the X are X rigs place the as X, I've Of half quarter. articulated, second internationally,

there's the So I'll latter that's color more part comment, let add that's occurring though. loaded William vis-a-vis in International, obviously back, of your to XXXX. toward International ramp a

fourth of budget on it's quarter Yes. focus a And I the lot and because a the seasonality. there's mean, of good comment.

some seasonality. term like rig longer coal tend the drilling be and contracts so because we business, On drilling tubing land seasonality rig other we like to fracking, business, businesses, that see don't forth, don't and experience the business, that really

having in the larger rigs discussions Tony of awards So benefit. in the reasons based will through quarter. also on have thinks we're why expect U.S., concrete fact, and that we'll explained But what clients the think we the more some he and this fourth negotiations we with is

margin. don't If up gross Lower pick bit So we we expect expect erosion in to XX. a with a activity anything, of to on little off drop see the the

will So course, the And significantly. mentioned up going very hold then, Tony to U.S. International is expand of as well.

if but adjusted line to guess, on helpful. comment, [ Super you ] a I the X want fine, year it? don't full it. Got have handle EBITDA

consensus. the with comfortable We're

that a segments All Okay. down of could other wondering if that you kind CapEx right. quick component. newbuild CapEx feed the in SANAD is just outside number our dial year, CapEx anything Tech? into maybe so of the But $XXX the help could be then extrapolations of that or But assumptions your in you the like wondering explicitly of of could segments, components might break maintenance any anything which of years? yes, do what across just would the we budget some us, outside this maybe million on And maybe you talk investments, great. SANAD Rig into could us forward NDS that if us give across maintenance you CapEx growth Just through follow-up, newbuild some help the with the

rigs, the so. a $X.X range million in maintenance international We in maybe $X.X bit or CapEx; have said $X.X more, a that U.S. rigs between and million, year require somewhere million

said take markets. CapEx, math experienced we international I average Obviously, expansion growth have in some the you for do have -- as that. year to this can tremendous rigs, if have we due before, So our the you mean, do we

the these get range million, new rigs between $XX to anywhere there say, ready. costs to some million that $X would start you are As contracts, I

basically, again, based So could XX math mentioned. on you that do the the rigs Tony

Got still helpful. back. it. I turn it Super

question the Barclays. with from Derek And comes Podhaizer next

your the provide on talking Lower what versus grow down. you're like was you Big about color more to of year the to flat some count balance Western if the to some wanted rig region versus the you seeing? that gas? you we rig go I comments you're I Can your it's little which know see most of to the seem as XX year? more expecting see far would you can can these additions, seeing us about the a your survey, privates half as do upside, talked where give the activity, Whether the versus detail of back Like Oil basins? the more for publics? different release back where but in additional

first for between we're ] to the make to and about, that just we're Well, but meaning, second you talking increase color. -- about [ quarter second more we're modest some and big quarter, next Sure. talking addition third is that the clear quarter here a give

past mix, So roughly course now give idea, roughly the it of X shifted you To XX%, was in over almost XXXX, definitely year, an the it's in more it's the quarters. back our customer public to operators.

So pretty the shift. theme that's just that about. plays And I a into talked good

is is level point we're that a high continued of other The that churn facing. there

applies bases. erosion idea, all the referred so, compared is but And quarter. margin To an there to, say count give first as it you we also rig is up churn a in modestly West I where to because pricing there's some across were William of increase, in churn, the Texas, would And churn.

is which Texas actually relatively say should is bit, they're has Northeast improved churn up, and little South I'd environment have an Dakota, Texas, improved North a and effect also activity. East the flat. on --

the So the obviously occurred. right the And large and at at part something market. that But XX% that's now fat the is consolidations is you our gas we're which rigs of market to, that can think not target focused I look are on. I've the referred operators

as going on moving talked that the play -- and slightly think, be we the our we're to actually strengths I've in translate rig into forward track performance, would promote count year. recognized companies. throughout our based for that's our obviously solutions we're record increasing the post-merger is -- and and And hope we hopefully I trying what to about to

I mean, the the privates I lot haven't been a of stability on clients bit client the source positive. a to some have of that also our providing of I've seen count. before, and comment seen clients I'll make on new smaller of a a rig some that. little are list

those -- we the going private increases the more of advantages we're going most, those -- consolidation been those the the from be but to happy Tony mean, of a where not of have some clients. to and handful that that is again, some with buyers. But mentioned, with at I that a most coming we're are see, of lot to big of than think rigs have some we of see trends clients the we're as this So some

half. second the about good feel in we So our prospects

That's months Maybe your up around contract now? still color. year seeing multiyear are Got sign more is to color where as all willing contracting? agreements? terms like for customers your conversations you really -- trends, Or contract some far you're trends than X as Just some it. duration of -- we and right well-to-well on see starting to helpful maybe are

giving I think aspirations the out it's portfolio. given there I as their locking by terming And look entire new programs. them is to and in of to several these their players think consolidations each occur, of of initiatives things, reassess bunch the at issue a causing are their where of of market the

I think at is so answer some well. market contracts the amenable the And we that as yes, and are looking is becoming more to term

from Capital question Waqar with next the comes Syed ATB And Markets.

When expect to bottom do out? margins you U.S. drilling

My goodness.

one. difficult a Yes. Always

you now, look think And per I $XX,XXX it's average at leading-edge if revenue Well, right our around our day. $XX,XXX, I think probably about $XX,XXX. averages

still there's some So room fall. to

count, we today. actually, in is and gives we're that pricing it truth, However, to maintain in where pricing the our getting continue you we've rig convergence leading-edge the and to tell close stability will us hope seen to pretty

XXk would the could still the to I drop, we towards but I would that level, point. say, expect be So low

Right. helpful. Very

Before year when? end. And

Okay.

this next to drop of So most be year year? the into and you it is going stabilizes of kind then think

-- same Yes, in think at so. time. we not keep changes that the I mean mind and everything

would into progressive record still very term longer get starting And like term for contracts. So new it's sign XX. way, because close we're rolling to in to happy we're Nabors a the all-time be by Lower which -- margins contracts, to longer contracts the we

Right.

side, debt the you the overall like to debt reduce on see to William number. good would total that Now

do perhaps QX end end, $X.X and number year this say the of of debt debt the expect be, to at you let's by year? billion. then by Where total So was end the next

So back the cash I you're working did flow, guidance. right? into well, Waqar, free provide

be than leave to The applied again, extra year. generation sheet. have we before So cash do the the reduce the our significantly will year. total think balance that midpoint we this And better expect our cash guidance somewhere could debt. if is the I And debt by reduce in said I million. of essentially all intention hit $XXX-plus not then to of cash we in year next on the free this range that to

the to we're use past. reduce done debt have to going So we in as it

comes Capital. question next with RBC from the And Keith MacKey

clearly rigs certainly Thanks for to all all editions, laid expect pretty across the rig color the you out on the add the international you've geographies.

notable Just any by rigs come next end the up in to getting a next could might that of expiries there the the are year? though, provide that churn the curious or XX months headwind against XXX --

maturity rigs is we last are these to on we've all many mean, oil X-year Saudi, there call, I deals. in recently. renewed on said And contracts -- of like the it, our think, X- I

market, with rigs. something to now But going of time now the contracts we onboard the comforting. in macro the period good. hiatus even startup immune, that's from during rig a depending we not Kuwait, pretty So the a feel occurring. think we're as But on right In have I we're obviously, this period these new to to

that's rigs backlog. they I is last about so compared given visibility scale, Argentine. now setback, backlog pronounced things just are what I what one for of and these gaps about of, than I rigs normal of about direction, And an So rigs having were numbers today, things said being gap. the those And little the move in about place in rigs, and represent more these the $XXX said international 'XX million the the comfortable in some idea with that's the expire And the billion, equate just $XXX U.S. of and rigs represented for give $X.X the but gave the a a of Saudi where just for little understand but now, X in you like -- on you always Argentine to Argentine When and call, the million. add will Saudi aware think contracts course. a 'XX And the when rigs the directionally, to you there's given U.S., on, the should the one little longer But we're you very a be macro. And that, that's

pretty the that's altogether, So backlog is of breathtaking. about $X.X billion, which

just about idea so we're talking give here. of Okay, an to what

been rigs, the haven't X mind Keith, to secured keep if yet. in those And of look our at question you rigs that your about presentation, XXX

probably So that of with estimate we those, we those. X get have X secured and but we about more discussions we haven't rigs,

we have at secured, right of now, and right rigs end looking now the more XX So the like at on based we're year, stuff the that XXXX.

we a Got per I it. optimistic No, little give that's about super number should a thinking must contracts? $XX,XXX daily international helpful. was help And some Can to on I rig more for be little margin, about be day. the in you're on $XX,XXX bit 'XX through and of projecting to us new cash bit how maybe you that you as just admit 'XX, QX, fold these

little because we when of startup. team of on experience, forecasts a downtime, additions bit new layer with that the happen see we So always rigs, the the in rig based a

downtime extensions So or doing in in is in cost we given Arabia. some addition, underlying mention all those did that we've And a there process, through we're -- going forecast recertification numbers. Saudi had the

underlying So these there's for events. forecasting in some $XXX now per day say I right would to $XXX

for new expect that's in XXXX. Tony quarter fourth our I've quarter, going of come third margin the on in. international sort than we forward, know what that market, $XX,XXX expectation. in quarter. And $XX,XXX we it we the to day you it sustainable the the add if that hit per it, we're the November said underlying top So guiding be for $XX,XXX, December the has rigs before, that that for of said we in be whether is higher we said or the said profitability approaching somewhat towards should But Saudi $XX,XXX then And as third the

comes with JP question And our Arun Jayaram next Morgan. from

to in was onshore of the or JV the one beyond of the Arabian market. to kind Nabor prospects entered in of the has deploy as newbuilds rig program. us could of Obviously, if Saudi Maybe talk competitive part newbuilds through go wondering to rig XX more has Saudi XX Tony, kind U.S. that Arabia. up SANAD you scheduled up the I about the of total balance your signing peers XX?

plan Yes. NDS previously newbuild it's a years that to long several is term Well, of ago to the of rigs a Aramco XX policy part upon by the as newbuilds. add about, embarked And industrialize was and Kingdom. program spoken we've

of there's fully plans they're And so about we're will part that now talked X working and XX process expect macro But 'XX. policy. those ones and X that are -- right continue in for unabated go, 'XX we've to that a we now, have the we because

as temporarily can there. is that that you far things that newbuilds vagaries commitment cetera. understand, course, we et have -- X there's is aware high of I've that get But gas of a Now, suspended, been today. continued spoken always the policy industrial and be working all rig be as should on as the for count And before, Aramco. to in is story And are such delivered priority about rigs the that

Kingdom So unconventional, of today, XX% there's market. the about XXX rigs are in about working them XX of the

mentioned, the be on going gas-directed, more than to are SANAD I of newbuilds gas. As and focused rigs are say XX% all

we're So a aligned have And we the stars in aligned. think are we with we really relative we're think position the And -- think all there. I good country's objectives.

market But I out going say they're market that ones some [ that think may other embark to immune Aramco can't from conditions. we to I on. all are for well those rig going that be there ] be does any There and count tempered conditions. to not that So say reasons, adjust adjustment we're temporary. should be will

incremental some down then Kuwait Vaca Kuwait. and on demand the And just some from disappointment what's your trends. both you my and Kuwait? rig announced have just Argentina Muerta maybe about in -- terms Kuwait what's Great. to follow-up, maybe thoughts? awards in of guys in term thoughts on you highlights going on Argentina Have been -- Tony, a been global long has spending recently Obviously,

upside. a bit and of beginning And every We're rolled is the disappointment. some here this award over, of term should and that of conference was think you going rolled on coming time additional we finally as correctly thing over that point my of just got very in talked be long that kind we're happy many out. we it key be calls, cementing, both for we years point about tender to rig our observed, Well, XX the view, from Kuwait, -- really are of famed and view.

we're not there award Just by a be rig actually way can should just comment, also you benefiting of from rig. parenthetical the that aware

drives is in rig awards wrenches competitor the latest for Our on in and top round rigs getting manufacturing business this Kingdom.

one really down benefit So upside us I've market to equipment well. Argentina, the us always that, particularly what's country is, has And good political really the going been rigs always makes things the double a there, of obviously, that we're we're financial fact of in market it and that use the in to rig as mentioned historical U.S. there, now, with is that respect are contracts the practices the terms a out. there to as But been that helped that's on there, Kuwait, of dollar in sense is additional situation story encumbrance. U.S. redeploying the supplying but resource, from with rigs favorable in occurred it's currency changes a a given for core I capacity. the idle think there, from down are making the compared the components. Nabors big And and side getting happened

offshore. Paid

stuff to thesis how of they're is they our the Nabors NDS lastly, there. NDS as on Casing And in are those has rigs. really on is me fast And in the taking fact, Yes. and working lot services point of increased content one Drilling U.S., the Managed doing Pressure surprises the down to robustly rigs hold then as a great where

upside a right And as basin more have a upside those great become for I useful. think that's us. path we services there's matures, And I of reputation now think that good and in kinds more that. will

we're countries. why both both keen -- on that's on So

comes question next with Daniel the Daniel Partners. And Energy John from

what It's that's be that be one. lateral customer? if press the in curious would Or how for about I I'm the just one-off And would next the with in the made the X-mile you the for a Delaware. more release outlook guys comment behind many year? that? just have

And that we'll Purvis for you. Travis have answer

by good think often. some one-off to John, ones well design that, to to deploy more don't I real and efficiencies positions are for a prove Yes. going had gained so A Customers acreage with are They value. that things question. has comment. real couple probably some -- that's sure. large be not the it's it that that

X-mile rigs are those drives, torque our our our top of amount in sigma of and positioned we terms can laterals. top the deliver to generate Secondly, drives, deliver well

longer -- a going we're think see I that we're X-mile than that even that. it's in the more pole So to and space of laterals those are we're position some and

not to more come, certainly but that's So a one-off.

I Okay. That's all had.

to Thank you. William would to like Conroy And this over comments. turn the session. question-and-answer concludes any our call back I for closing

Thank you, us everyone, this joining for morning.

If with wrap you call questions, up up the any us. we'll please additional follow there. Keith, have Thank you.

today's has Thank concluded. presentation. you conference attending for The Thank you. now

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