• Adjusted EBITDA Margin: 25.1% for the full year 2024, highest in over 15 years.
• Adjusted Free Cash Flow: $524 million for the year 2024.
• North America Revenue: Down 2% sequentially in Q4 2024.
• International Revenue: Down 6% sequentially and 3% year-over-year in Q4 2024; full-year growth of 10% led by Middle East, North Africa, and Asia.
• Dividend: Two quarterly dividends of $0.25 per share paid in 2024.
• Share Repurchase: Approximately $99 million of shares repurchased in the second half of 2024.
• CapEx: $299 million or 5.4% of revenues for 2024.
• Liquidity: Approximately $1.3 billion.
• Q1 2025 Revenue Guidance: $1.17 billion to $1.21 billion.
• Q1 2025 Adjusted EBITDA Guidance: $245 million to $265 million.
• 2025 Revenue Guidance: $5.10 billion to $5.35 billion.
• 2025 Adjusted EBITDA Guidance: $1.20 billion to $1.35 billion.

• Warning! GuruFocus has detected 3 Warning Sign with EFX.

Release Date: February 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Weatherford International PLC (NASDAQ:WFRD) achieved adjusted EBITDA margins exceeding 25% for the full year, marking the highest full-year margin in over 15 years.
• The company generated $524 million in adjusted free cash flow for 2024, demonstrating strong cash generation capabilities.
• International business grew by 10% on a full-year basis, with significant growth in the Middle East, North Africa, and Asia regions.
• Weatherford International PLC (NASDAQ:WFRD) paid two quarterly dividends of $0.25 per share and repurchased approximately $99 million of shares during the second half of 2024.
• The Well Services product line has grown over 50% in three years, representing a significant growth vector with low capital intensity.

Negative Points

• The fourth quarter did not meet expectations due to a significant reduction in activity in Latin America, particularly in Mexico.
• North America revenue was down 2% sequentially, primarily due to a continued reduction in US land activity.
• International revenues are expected to decline mid-single digits in 2025, primarily due to challenges in Mexico and Russia.
• The company anticipates a significant decline in activity levels in Mexico, which will impact 2025 revenues.
• Weatherford International PLC (NASDAQ:WFRD) faces challenges in Russia due to sanctions and FX volatility, contributing to a decline in revenues.

Q & A Highlights

Q: Can you confirm if Saudi Arabia's growth will offset declines in Mexico and Russia? Also, how is Weatherford growing in Saudi when peers are seeing declines? A: Saudi Arabia will be up, but it won't fully offset declines in Mexico and Russia. We've improved our business in Saudi through technology introduction and operational execution. Our under-penetration in Saudi gives us more growth opportunities despite market declines. (Girish Saligram, CEO)

Q: What is Weatherford's approach to the potential recovery in Mexico's activity levels? A: We are taking a conservative approach, assuming a 30% to 50% decline in activity. We are not assuming a dramatic ramp-up in the second half. If a recovery occurs, it will be upside for us. We have a strong line of sight to contract starts and activity increases. (Girish Saligram, CEO)

Q: How is Weatherford addressing the challenges in Russia given the sanctions and market conditions? A: We continue to operate in Russia under three principles: safety, economic sense, and compliance with international sanctions and local laws. The business has declined as a percentage of total revenue, and we expect this trend to continue due to sanctions and FX volatility. (Girish Saligram, CEO)

Q: Can you discuss the success and future outlook of the Managed Pressure Drilling (MPD) product line? A: MPD is a significant growth area for us. We've introduced Modus, which is now deployed in multiple regions. We see increasing demand for MPD packages and managed pressure wells, which will drive future growth. (Girish Saligram, CEO)

Q: How is Weatherford improving North America margins despite a declining market? A: We focus on cost reduction, pricing, and market penetration. We've consolidated facilities, reduced procurement spend, and driven pricing through technology differentiation and service quality. We've also expanded into new basins and services. (Girish Saligram, CEO)

For the complete transcript of the earnings call, please refer to the full earnings call transcript.