Nabors Industries (NBR) Q4 2024 earnings summary

Executive summary

• Q4 2024 free cash flow was below expectations due to delayed receivables in Mexico and accelerated milestone payments in Saudi Arabia.

• Adjusted EBITDA for Q4 was $221 million, with stable but disappointing Lower 48 market conditions.

• International expansion continued with 10 rigs activated in 2024, new awards in Argentina and Colombia, and robust growth in Saudi Arabia.

• The Parker Wellbore acquisition is expected to close in Q1 2025, with anticipated annualized cost synergies of at least $35 million.

• Drilling Solutions achieved record gross margin above 54% in Q4 2024, with strong international rig deployments.

Financial highlights

• Q4 2024 operating revenues were $730 million, nearly flat sequentially from Q3 2024.

• Adjusted EBITDA for Q4 was $221 million, nearly flat sequentially.

• Net loss for Q4 2024 was $54 million, or $6.67 per diluted share.

• Adjusted free cash flow for Q4 2024 was negative $53.3 million, reflecting higher capital expenditures and delayed payments.

• Year-end 2024 net debt was $2.1 billion.

Outlook and guidance

• 2025 guidance anticipates a flat U.S. market, growth in international and Drilling Solutions, and continued investment in Saudi Arabia.

• Lower 48 average rig count expected at 62-64, with daily gross margin around $14,600–$14,800.

• International Drilling targeting average daily margin of $17,600 and rig count of 88-89.

• 2025 CapEx forecasted at $710–$720 million, with $360 million for SANAD new builds.

• Consolidated free cash flow projected to be around break-even, with $150 million positive outside SANAD.