Nabors Industries (NBR) Q2 2024 earnings summary

Executive summary

• Q2 2024 Adjusted EBITDA was $218 million, with strong international rig growth and robust daily margins in the U.S. Lower 48, offsetting softness in domestic activity.

• Net loss attributable to shareholders was $32.3 million, improving from Q1 2024, as international drilling activity and technology adoption drove results.

• International rig count and deployments increased, with new contracts in Kuwait, Algeria, and Saudi Arabia, and 19 deployments scheduled over 18 months.

• Technology and automation initiatives, including SmartROS and PowerTAP™, expanded margin gains and operational achievements.

• Continued deleveraging, with net debt reduced to $2.04 billion and sustainability and energy transition efforts advancing.

Financial highlights

• Q2 2024 revenues were $734.8 million, nearly flat sequentially but down 4% year-over-year, with international segment growth offsetting U.S. declines.

• Adjusted EBITDA was $218 million, slightly down from $221 million in Q1 and $235 million in Q2 2023.

• Adjusted free cash flow for Q2 was $57 million, up from $8 million in Q1, with first half 2024 total at $65 million.

• Net debt at June 30, 2024 was $2.04 billion, down from $2.09 billion at March 31, 2024.

• Q2 2024 net loss attributable to shareholders was $32.3 million, or $4.29 per diluted share.

Outlook and guidance

• Five international rig startups expected in H2 2024, with 19 deployments scheduled over 18 months and 10 more visible for 2025-2026.

• Lower 48 rig count projected to tick up slightly in Q3, with daily margins between $15,100 and $15,200.

• International daily margins expected to rise to $16,200–$16,300 in Q3 and approach $17,000 in Q4.

• Full-year 2024 adjusted free cash flow guidance reaffirmed at $100–$200 million; capex expected at approximately $590 million.

• Drilling Solutions and Rig Technologies segments forecast sequential EBITDA growth.