Oil States International (OIS) Sidoti's Year End Virtual Investor Conference summary

Key strategic themes

• Accelerating shift toward offshore and international markets, reducing U.S. shale exposure for more stable, higher-margin revenue streams and improved free cash flow generation.

• Highest backlog in over a decade at $399 million, providing strong visibility into 2026 and supporting robust revenue and bookings guidance for the fourth quarter.

• Focus on technology-driven differentiation, with leading market share in Flex Joint connectors and new product introductions like Managed Pressure Drilling Systems and low-impact workover riser packages.

• Ongoing investment in R&D and organic growth, with selective tuck-in acquisitions only when highly strategic.

• Expansion into new energy markets, including offshore wind, carbon capture, geothermal, and subsea minerals, leveraging legacy oil and gas technologies.

Financial performance and capital allocation

• Free cash flow yield at 19% on a trailing twelve-month basis, with guidance for over $100 million in free cash flow for the year.

• Net debt reduced to $38 million as of September 30, with expectations to reach net debt zero by year-end, ahead of 2026 convertible note maturity.

• Aggressive share repurchases underway, with potential for future dividends depending on shareholder preference.

• CapEx elevated to $32–$33 million for the year due to completion of a new facility in Batam, Indonesia, but expected to decrease going forward.

• Trading at 5.2x EBITDA, management views current valuation as compelling relative to technology and cash generation.

Segment highlights and operational focus

• Offshore Manufactured Products is the largest and most global segment, driving growth and margin improvement.

• Completion and Production Services segment is being streamlined, exiting commoditized, lower-margin lines to focus on differentiated rental and service offerings.

• Downhole Technologies segment challenged by lower U.S. shale activity but targeting recovery through new technology and international expansion.

• New facilities and global manufacturing footprint support organic growth and cost efficiency.

• Backlog and multi-year project cycles in offshore/international markets provide revenue stability and reduced cyclicality compared to U.S. shale.