NOV Reports Fourth Quarter and Full Year 2022 Results
- Revenue of
$2.07 billion , up 10% sequentially and 37% year-over-year - Operating Profit of
$162 million , up$107 million sequentially and$177 million year-over-year - Net Income of
$104 million , or$0.26 per fully diluted share - Adjusted EBITDA* of
$231 million , up$36 million sequentially and$162 million year-over-year
*Adjusted EBITDA is a non-GAAP measure, see “Non-GAAP Financial Measures” and “Reconciliation of Adjusted EBITDA to Net Income (Loss)” below.
Revenues for the full year 2022 were
“Our fourth quarter results reflect a strong finish to a year that saw rising demand for NOV’s products and services, gradually normalizing global supply chains, and improving execution by our organization,” stated
“While recent declines in North American natural gas prices and persistent global recession risks may pose near-term headwinds to oilfield activity, we believe that the world simply must rebuild and fortify its petroleum supply capability soon and a sustained oil and gas up-cycle is required to increase energy security across the globe. Years of chronic underinvestment and a pandemic lockdown that severely stunted capacity make this up-cycle all the more urgent and daunting. NOV is up to the challenge. We stand ready to equip the industry with the tools necessary to do the job efficiently, economically, safely, and with minimal environmental impact.”
Wellbore Technologies
Wellbore Technologies generated revenues of
Completion & Production Solutions
Completion & Production Solutions generated revenues of
New orders booked during the quarter totaled
Rig Technologies
Rig Technologies generated revenues of
New capital equipment orders booked during the quarter totaled
Corporate Information
During the fourth quarter, the Company recorded a net credit of
As of
Significant Achievements
NOV completed the landmark delivery of an integrated drilling equipment and subsea package for the world’s second 8th-generation drillship. The drillship is the most technically capable drilling rig in the world, equipped with the world’s first two 20,000-psi subsea blowout preventers (BOPs), the world’s first three-million-pound hook load hoisting system, and the world’s first five 10,000-psi mud pumps. NOV developed, tested, and manufactured more than 30 new products for the rig in preparation for 20,000-psi operations with a super major in the
NOV sold 20,000 horsepower of Ideal™ eFrac pressure pumping equipment to a leading North American stimulation service company during the quarter. NOV’s 5,000 HHP Ideal eFrac pumps consistently displace up to three conventional frac units on location and are proven to reduce operational expenses on pump maintenance by up to 30%.
NOV secured orders from two customers for the design licenses and jacking systems of two NG-20000X wind turbine installation vessels. Designed for larger and heavier next generation wind turbines, the NG-20000X is intended for use in harsh environments and water depths of up to 70 meters. With its fourth and fifth orders for this class of vessel, NOV continues to prove its ability to develop new industry standard solutions for vessels and jacking systems by working closely with key market players and customizing NOV’s proprietary technology to our customers' specific needs.
NOV signed a contract with a major semiconductor manufacturer to supply FM 4922-compliant fume-and-smoke exhaust composite ducts designed to reduce fire risks in cleanroom operations. The multi-million-dollar award is destined for a new
NOV received two orders for new, leading-edge drill pipe product offerings. NOV received orders from the
NOV signed a contract with a major engineering, procurement, and construction company to supply composite piping systems for production facilities associated with the Tilenga project in
NOV secured several large tenders in the West African region for its Viper™ Connectors, an encouraging signal of recovering activity for a key deep-water market. Developed for deep-water and ultra-deep-water projects where reliability and fatigue performance are paramount, the field-proven Viper connector is the top choice for extreme-service conductor and casing applications.
NOV established a new performance benchmark with its Agitator™ZP friction reduction tool while drilling a deviated three-mile lateral in the 6¾-inch section for a major operator in
NOV supported pioneering efforts to more efficiently develop geothermal resources during the quarter. In December, the
NOV secured two new geothermal contracts for its TK™-Liner in
NOV’s Managed Pressure Drilling (MPD) team secured several significant contract awards during the quarter. A major offshore drilling contractor conducted a system evaluation and chose NOV MPD as the new standard for its Applied-Surface-Back-Pressure MPD system across its fleet of rigs. NOV will deliver the first MPD Integrated-Riser-Joint package to the customer with additional orders expected to follow. A second significant MPD order received during the quarter, bound for offshore
NOV’s Downhole Broadband Solutions (DBS) business continues to gather market momentum with its full suite of drilling optimization services that include visualization tools, wired drill pipe (WDP), downhole drilling tools, and real-time sensors. Two major independent customers, pleased with the improved drilling and wellbore construction performance enabled by NOV’s DBS products, signed contract extensions for drilling operations on the Norwegian Continental Shelf. Additionally, NOV received its first order for wired Delta™ pipe connections for a major operator in
Fourth Quarter Earnings Conference Call
NOV will hold a conference call to discuss its fourth quarter 2022 results on
About NOV
NOV (NYSE: NOV) delivers technology-driven solutions to empower the global energy industry. For more than 150 years, NOV has pioneered innovations that enable its customers to safely produce abundant energy while minimizing environmental impact. The energy industry depends on NOV’s deep expertise and technology to continually improve oilfield operations and assist in efforts to advance the energy transition towards a more sustainable future. NOV powers the industry that powers the world.
Visit www.nov.com for more information.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures that management believes are useful tools for internal use and the investment community in evaluating NOV’s overall financial performance. These non-GAAP financial measures are broadly used to value and compare companies in the oilfield services and equipment industry. Not all companies define these measures in the same way. In addition, these non-GAAP financial measures are not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures. Please see the attached schedules for reconciliations of the differences between the non-GAAP financial measures used in this press release and the most directly comparable GAAP financial measures.
Cautionary Statement for the Purpose of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995
Statements made in this press release that are forward-looking in nature are intended to be “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 and may involve risks and uncertainties. These statements may differ materially from the actual future events or results. Readers are referred to documents filed by NOV with the
Certain prior period amounts have been reclassified in this press release to be consistent with current period presentation.
|
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Three Months Ended |
|
Year Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
2022 |
|
2021 |
|
2022 |
|
2022 |
|
2021 |
||||||||||
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
762 |
|
|
$ |
576 |
|
|
$ |
741 |
|
|
$ |
2,777 |
|
|
$ |
1,959 |
|
|
Completion & Production Solutions |
|
|
738 |
|
|
|
549 |
|
|
|
681 |
|
|
|
2,588 |
|
|
|
1,963 |
|
|
Rig Technologies |
|
|
620 |
|
|
|
431 |
|
|
|
511 |
|
|
|
2,034 |
|
|
|
1,739 |
|
|
Eliminations |
|
|
(47 |
) |
|
|
(39 |
) |
|
|
(44 |
) |
|
|
(162 |
) |
|
|
(137 |
) |
|
Total revenue |
|
|
2,073 |
|
|
|
1,517 |
|
|
|
1,889 |
|
|
|
7,237 |
|
|
|
5,524 |
|
|
Gross profit |
|
|
443 |
|
|
|
202 |
|
|
|
368 |
|
|
|
1,334 |
|
|
|
774 |
|
|
Gross profit % |
|
|
21.4 |
% |
|
|
13.3 |
% |
|
|
19.5 |
% |
|
|
18.4 |
% |
|
|
14.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Selling, general, and administrative |
|
|
281 |
|
|
|
217 |
|
|
|
313 |
|
|
|
1,070 |
|
|
|
908 |
|
|
Operating profit (loss) |
|
|
162 |
|
|
|
(15 |
) |
|
|
55 |
|
|
|
264 |
|
|
|
(134 |
) |
|
Interest Expense, net |
|
|
(14 |
) |
|
|
(17 |
) |
|
|
(13 |
) |
|
|
(59 |
) |
|
|
(68 |
) |
|
Equity income (loss) in unconsolidated affiliates |
|
|
36 |
|
|
|
1 |
|
|
|
12 |
|
|
|
68 |
|
|
|
(5 |
) |
|
Other income (expense), net |
|
|
(43 |
) |
|
|
2 |
|
|
|
10 |
|
|
|
(35 |
) |
|
|
(23 |
) |
|
Income (loss) before income taxes |
|
|
141 |
|
|
|
(29 |
) |
|
|
64 |
|
|
|
238 |
|
|
|
(230 |
) |
|
Provision for income taxes |
|
|
42 |
|
|
|
14 |
|
|
|
29 |
|
|
|
83 |
|
|
|
15 |
|
|
Net income (loss) |
|
|
99 |
|
|
|
(43 |
) |
|
|
35 |
|
|
|
155 |
|
|
|
(245 |
) |
|
Net income (loss) attributable to noncontrolling interests |
|
|
(5 |
) |
|
|
(3 |
) |
|
|
3 |
|
|
|
— |
|
|
|
5 |
|
|
Net income (loss) attributable to Company |
|
$ |
104 |
|
|
$ |
(40 |
) |
|
$ |
32 |
|
|
$ |
155 |
|
|
$ |
(250 |
) |
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Basic |
|
$ |
0.27 |
|
|
$ |
(0.10 |
) |
|
$ |
0.08 |
|
|
$ |
0.40 |
|
|
$ |
(0.65 |
) |
|
Diluted |
|
$ |
0.26 |
|
|
$ |
(0.10 |
) |
|
$ |
0.08 |
|
|
$ |
0.39 |
|
|
$ |
(0.65 |
) |
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Basic |
|
|
391 |
|
|
|
387 |
|
|
|
391 |
|
|
|
390 |
|
|
|
386 |
|
|
Diluted |
|
|
395 |
|
|
|
387 |
|
|
|
393 |
|
|
|
394 |
|
|
|
386 |
|
|
|
||||||
|
|
||||||
|
|
|
|
||||
|
|
|
2022 |
|
2021 |
||
|
ASSETS |
|
|
|
|
||
|
Current assets: |
|
|
|
|
||
|
Cash and cash equivalents |
|
$ |
1,069 |
|
$ |
1,591 |
|
Receivables, net |
|
|
1,739 |
|
|
1,321 |
|
Inventories, net |
|
|
1,813 |
|
|
1,331 |
|
Contract assets |
|
|
685 |
|
|
461 |
|
Other current assets |
|
|
187 |
|
|
198 |
|
Total current assets |
|
|
5,493 |
|
|
4,902 |
|
|
|
|
|
|
||
|
Property, plant and equipment, net |
|
|
1,781 |
|
|
1,823 |
|
Lease right-of-use assets |
|
|
517 |
|
|
537 |
|
|
|
|
1,995 |
|
|
2,030 |
|
Other assets |
|
|
349 |
|
|
258 |
|
Total assets |
|
$ |
10,135 |
|
$ |
9,550 |
|
|
|
|
|
|
||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||
|
Current liabilities: |
|
|
|
|
||
|
Accounts payable |
|
$ |
906 |
|
$ |
612 |
|
Accrued liabilities |
|
|
959 |
|
|
778 |
|
Contract liabilities |
|
|
444 |
|
|
392 |
|
Current portion of lease liabilities |
|
|
87 |
|
|
99 |
|
Current portion of long-term debt |
|
|
13 |
|
|
5 |
|
Accrued income taxes |
|
|
28 |
|
|
24 |
|
Total current liabilities |
|
|
2,437 |
|
|
1,910 |
|
|
|
|
|
|
||
|
Long-term debt |
|
|
1,717 |
|
|
1,708 |
|
Lease liabilities |
|
|
549 |
|
|
576 |
|
Other liabilities |
|
|
298 |
|
|
292 |
|
Total liabilities |
|
|
5,001 |
|
|
4,486 |
|
|
|
|
|
|
||
|
Total stockholders’ equity |
|
|
5,134 |
|
|
5,064 |
|
Total liabilities and stockholders’ equity |
|
$ |
10,135 |
|
$ |
9,550 |
|
|
||||||||||||
|
|
||||||||||||
|
|
|
Three Months Ended |
|
Years Ended |
||||||||
|
|
|
|
|
|
||||||||
|
|
|
2022 |
|
2022 |
|
2021 |
||||||
|
Cash flows from operating activities: |
|
|
|
|
||||||||
|
Net income (loss) |
|
$ |
99 |
|
|
$ |
155 |
|
|
$ |
(245 |
) |
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
||||||
|
Depreciation and amortization |
|
|
76 |
|
|
|
301 |
|
|
|
306 |
|
|
Impairment and loss on assets held for sale |
|
|
2 |
|
|
|
127 |
|
|
|
— |
|
|
Working capital and other operating items, net |
|
|
(23 |
) |
|
|
(762 |
) |
|
|
230 |
|
|
Net cash provided by (used in) operating activities |
|
|
154 |
|
|
|
(179 |
) |
|
|
291 |
|
|
|
|
|
|
|
|
|
||||||
|
Cash flows from investing activities: |
|
|
|
|
|
|
||||||
|
Purchases of property, plant and equipment |
|
|
(66 |
) |
|
|
(214 |
) |
|
|
(201 |
) |
|
Business acquisitions, net of cash acquired |
|
|
(2 |
) |
|
|
(49 |
) |
|
|
(52 |
) |
|
Other |
|
|
3 |
|
|
|
25 |
|
|
|
57 |
|
|
Net cash used in investing activities |
|
|
(65 |
) |
|
|
(238 |
) |
|
|
(196 |
) |
|
|
|
|
|
|
|
|
||||||
|
Cash flows from financing activities: |
|
|
|
|
|
|
||||||
|
Borrowings against lines of credit and other debt |
|
|
4 |
|
|
|
20 |
|
|
|
60 |
|
|
Payments against lines of credit and other debt |
|
|
(4 |
) |
|
|
(4 |
) |
|
|
(183 |
) |
|
Cash dividends paid |
|
|
(19 |
) |
|
|
(78 |
) |
|
|
(20 |
) |
|
Other |
|
|
(5 |
) |
|
|
(34 |
) |
|
|
(46 |
) |
|
Net cash used in financing activities |
|
|
(24 |
) |
|
|
(96 |
) |
|
|
(189 |
) |
|
Effect of exchange rates on cash |
|
|
6 |
|
|
|
(9 |
) |
|
|
(7 |
) |
|
Increase (decrease) in cash and cash equivalents |
|
|
71 |
|
|
|
(522 |
) |
|
|
(101 |
) |
|
Cash and cash equivalents, beginning of period |
|
|
998 |
|
|
|
1,591 |
|
|
|
1,692 |
|
|
Cash and cash equivalents, end of period |
|
$ |
1,069 |
|
|
$ |
1,069 |
|
|
$ |
1,591 |
|
|
|
||||||||||||||||||||
|
Presented below is a reconciliation of Net Income (Loss) to Adjusted EBITDA. The Company defines Adjusted EBITDA as Operating Profit excluding Depreciation, Amortization, Gains and Losses on Sales of Fixed Assets, and, when applicable, Other Items. Management believes this is important information to provide because it is used by management to evaluate the Company’s operational performance and trends between periods and manage the business. Management also believes this information may be useful to investors and analysts to gain a better understanding of the Company’s results of ongoing operations. Adjusted EBITDA is not intended to replace GAAP financial measures, such as Net Income. Other Items include impairment, restructure, severance, facility closure costs and inventory charges and credits. |
||||||||||||||||||||
|
|
|
Three Months Ended |
|
Year Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
2022 |
|
2021 |
|
2022 |
|
2022 |
|
2021 |
||||||||||
|
Operating profit (loss): |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
110 |
|
|
$ |
50 |
|
|
$ |
74 |
|
|
$ |
304 |
|
|
$ |
74 |
|
|
Completion & Production Solutions |
|
|
50 |
|
|
|
(16 |
) |
|
|
21 |
|
|
|
69 |
|
|
|
(65 |
) |
|
Rig Technologies |
|
|
80 |
|
|
|
1 |
|
|
|
22 |
|
|
|
144 |
|
|
|
43 |
|
|
Eliminations and corporate costs |
|
|
(78 |
) |
|
|
(50 |
) |
|
|
(62 |
) |
|
|
(253 |
) |
|
|
(186 |
) |
|
Total operating profit (loss) |
|
$ |
162 |
|
|
$ |
(15 |
) |
|
$ |
55 |
|
|
$ |
264 |
|
|
$ |
(134 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Other Items, net: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
(1 |
) |
|
$ |
2 |
|
|
$ |
31 |
|
|
$ |
60 |
|
|
$ |
31 |
|
|
Completion & Production Solutions |
|
|
— |
|
|
|
2 |
|
|
|
19 |
|
|
|
36 |
|
|
|
1 |
|
|
Rig Technologies |
|
|
(11 |
) |
|
|
3 |
|
|
|
13 |
|
|
|
— |
|
|
|
22 |
|
|
Corporate |
|
|
4 |
|
|
|
1 |
|
|
|
— |
|
|
|
18 |
|
|
|
5 |
|
|
Total Other Items |
|
$ |
(8 |
) |
|
$ |
8 |
|
|
$ |
63 |
|
|
$ |
114 |
|
|
$ |
59 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
(Gain)/Loss on Sales of Fixed Assets |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
— |
|
|
$ |
(3 |
) |
|
$ |
1 |
|
|
$ |
— |
|
|
$ |
(1 |
) |
|
Completion & Production Solutions |
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
(3 |
) |
|
|
(1 |
) |
|
Rig Technologies |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
(2 |
) |
|
Corporate |
|
|
— |
|
|
|
4 |
|
|
|
1 |
|
|
|
3 |
|
|
|
2 |
|
|
Total (Gain)/Loss on Sales of Fixed Assets |
|
$ |
1 |
|
|
$ |
1 |
|
|
$ |
1 |
|
|
$ |
— |
|
|
$ |
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Depreciation & amortization: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
37 |
|
|
$ |
39 |
|
|
$ |
39 |
|
|
$ |
150 |
|
|
$ |
158 |
|
|
Completion & Production Solutions |
|
|
15 |
|
|
|
16 |
|
|
|
16 |
|
|
|
62 |
|
|
|
62 |
|
|
Rig Technologies |
|
|
19 |
|
|
|
17 |
|
|
|
18 |
|
|
|
73 |
|
|
|
71 |
|
|
Corporate |
|
|
5 |
|
|
|
3 |
|
|
|
3 |
|
|
|
16 |
|
|
|
15 |
|
|
Total depreciation & amortization |
|
$ |
76 |
|
|
$ |
75 |
|
|
$ |
76 |
|
|
$ |
301 |
|
|
$ |
306 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Wellbore Technologies |
|
$ |
146 |
|
|
$ |
88 |
|
|
$ |
145 |
|
|
$ |
514 |
|
|
$ |
262 |
|
|
Completion & Production Solutions |
|
|
66 |
|
|
|
2 |
|
|
|
56 |
|
|
|
164 |
|
|
|
(3 |
) |
|
Rig Technologies |
|
|
88 |
|
|
|
21 |
|
|
|
52 |
|
|
|
217 |
|
|
|
134 |
|
|
Eliminations and corporate costs |
|
|
(69 |
) |
|
|
(42 |
) |
|
|
(58 |
) |
|
|
(216 |
) |
|
|
(164 |
) |
|
Total Adjusted EBITDA |
|
$ |
231 |
|
|
$ |
69 |
|
|
$ |
195 |
|
|
$ |
679 |
|
|
$ |
229 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Reconciliation of Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
GAAP net income (loss) attributable to Company |
|
$ |
104 |
|
|
$ |
(40 |
) |
|
$ |
32 |
|
|
$ |
155 |
|
|
$ |
(250 |
) |
|
Noncontrolling interests |
|
|
(5 |
) |
|
|
(3 |
) |
|
|
3 |
|
|
|
- |
|
|
|
5 |
|
|
Provision for income taxes |
|
|
42 |
|
|
|
14 |
|
|
|
29 |
|
|
|
83 |
|
|
|
15 |
|
|
Interest Expense, net |
|
|
14 |
|
|
|
17 |
|
|
|
13 |
|
|
|
59 |
|
|
|
68 |
|
|
Equity (income) loss in unconsolidated affiliate |
|
|
(36 |
) |
|
|
(1 |
) |
|
|
(12 |
) |
|
|
(68 |
) |
|
|
5 |
|
|
Other (income) expense, net |
|
|
43 |
|
|
|
(2 |
) |
|
|
(10 |
) |
|
|
35 |
|
|
|
23 |
|
|
Depreciation and amortization |
|
|
76 |
|
|
|
75 |
|
|
|
76 |
|
|
|
301 |
|
|
|
306 |
|
|
(Gain)/Loss on Sales of Fixed Assets |
|
|
1 |
|
|
|
1 |
|
|
|
1 |
|
|
|
— |
|
|
|
(2 |
) |
|
Other Items |
|
|
(8 |
) |
|
|
8 |
|
|
|
63 |
|
|
|
114 |
|
|
|
59 |
|
|
Total Adjusted EBITDA |
|
$ |
231 |
|
|
$ |
69 |
|
|
$ |
195 |
|
|
$ |
679 |
|
|
$ |
229 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20230206005534/en/
Vice President, Corporate Development and Investor Relations
(713) 815-3535
Blake.McCarthy@nov.com
Source: