Release Date: January 30, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: How do you view the competitive dynamics and pricing environment for Production Enhancement in the US market? A: Lawrence Bruno, CEO, stated that the market is crowded with a lot of competition. Some buyers are willing to pay for technology and performance, while others prefer commodity products. Core Labs aims to differentiate its products through technology advantages. Pricing has been stable, but there is a desire for higher rewards for their technology due to the market's capacity.
Q: What are the expectations for the Reservoir Description (RD) business internationally in 2025, and what will be the biggest drivers? A: Lawrence Bruno, CEO, mentioned that they expect a seasonal decline from Q4 to Q1 due to weather and sanctions affecting product sales and laboratory work. Despite these challenges, they anticipate mid-single-digit growth for Reservoir Description, driven by strong international activity and project progression.
Q: Can you provide more detail on the international markets where you see the most growth in 2025? A: Lawrence Bruno, CEO, highlighted growth in the Middle East, South Atlantic Margin, Asia-Pacific, and the North Sea. They are optimistic about projects in Australia, Indonesia, and Norway. However, they have exited the Mexican market, which they believe will be beneficial in the near term.
Q: How did the Q1 weather impact operations, and where were the largest effects felt? A: Lawrence Bruno, CEO, explained that freeze-related closures affected their main product manufacturing facility in Godley, Texas, and their largest laboratory in Houston. Other facilities along the Texas-Louisiana border and in South Louisiana also experienced closures. These disruptions resulted in approximately $1 million in lost revenue.
Q: How are geopolitical disruptions affecting Reservoir Description margins in Q1? A: Lawrence Bruno, CEO, confirmed that geopolitical disruptions, particularly sanctions, have a significant impact on margins. These sanctions affected both product sales and crude assay work, impacting profitability. If sanctions are lifted, there may be opportunities to recover some of the lost business later in the year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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