National Energy Services Reunited (NESR) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 revenue of $336.2 million, up 12% year-over-year and 3.5% sequentially, with strong EBITDA, EPS, and cash flow growth.

• Net income for Q3 2024 was $20.6 million, a 40% increase year-over-year and 9.2% sequentially.

• Balance sheet strengthened, with net debt to trailing 12-month adjusted EBITDA falling to 0.96.

• Relisted on NASDAQ after two years of remediation, signaling renewed confidence.

• Strong operational execution and technology initiatives, including successful projects in Saudi Arabia and Kuwait.

Financial highlights

• Q3 2024 revenue reached $336.2 million, up 12% year-over-year and 3.5% sequentially.

• Year-to-date revenue at $958 million, up 14.3% year-over-year.

• Adjusted EBITDA for Q3 2024 was $80 million (23.8% margin), with year-to-date adjusted EBITDA at $222.9 million, up 21.9% year-over-year.

• Free cash flow for Q3 was $43.4 million; year-to-date free cash flow was $103 million, up 38.1% year-over-year.

• Cash and cash equivalents stood at $118.2 million as of September 30, 2024, up from $67.8 million at year-end 2023.

Outlook and guidance

• MENA market expected to grow at a low single-digit rate in 2025, with the company targeting double that growth.

• Anticipates continued outperformance driven by core business, directional drilling (Roya platform), and decarbonization initiatives.

• CapEx for 2024 expected to be $120 million, with similar levels projected for 2025 to support growth.

• Free cash flow conversion expected to remain around 40% of EBITDA.

• Management remains focused on profitable revenue growth, execution efficiency, technology expansion, and debt reduction.