Forum Energy Technologies (FET) 17th Annual Southwest IDEAS Conference summary

Company overview and business segments

• Manufactures products for Artificial & Downhole and Drilling & Completions segments, serving both operators and major oilfield service companies globally.

• About half of sales are international, with a product mix of 75% consumables and 25% capital equipment.

• Consumables are high-value, recurring products with a 3–6 month replacement cycle; capital equipment includes specialized tools like high-torque Iron Roughnecks.

• Revenue grew 15% from 2021–2024, with EBITDA rising from $20M to $100M and margins tripling to 12%.

Financial performance and value proposition

• Five-year annualized stock returns of 19% vs. 10% for the Russell; one-year return of 73% vs. 9%.

• Revenue growth nearly double the Russell 2000, with 73% CAGR in cash flow.

• Cash flow yield is nearly four times higher than the Russell 2000; valuation metrics indicate undervaluation.

• Leverage is about one-third that of the Russell 2000, with significant deleveraging since 2019.

• 50% of free cash flow used to reduce debt, 50% for share repurchases and acquisitions; 7% of shares retired since October.

Growth strategy and market positioning

• Implements a 'beat the market' strategy by targeting markets with limited competition and leveraging manufacturing know-how and IP.

• Global manufacturing and distribution footprint enables rapid response and tariff mitigation.

• Since 2022, increased average revenue per rig by 20% through this strategy.

• Leadership markets (two-thirds of revenue) have 36% share in a $1.5B addressable market; examples include coiled tubing, wireline, ROVs, and sand control.

• Growth markets (one-third of revenue) target a $3B market with lower share, focusing on new applications and international expansion.