Core Laboratories N.V. (NYSE:CLB) Q4 2022 Earnings Call Transcript

Simon Galligani: Thank you for taking my question. I saw that you acquired own shares for about $1.6 million in the fourth quarter, which I guess is the first buyback since the invasion. I know that you guys are focused on bringing the leverage ratio down to 1.5. But should we read into this that you’ll gradually resume the buybacks simultaneously as you continue to reduce the leverage ratio?

Chris Hill: Yes. Hey Simon, this is Chris. So when you think about the share buybacks, think about that in maybe two buckets, one is where we go into the open market and buyback shares. The other bucket is when employees have share awards that vest, they have the opportunity or they generally will sell those shares that are for tax — their tax burden associated with that to the company. So we will buy those shares from the employee to settle their tax burden associated with the vesting awards. And that’s what you saw in the fourth quarter. We did not go out to the open market and buy any shares. Having said that, once we get our leverage ratio down to where at least we’re getting towards the target, we’ve got more clear sight on what the forecast looks like. Absolutely, we could see ourselves getting more active in the share buyback program off the open market.

Simon Galligani: Okay. Thank you for the clarity and yes, the comment there. Thanks.

Gwen Gresham: Thank you, Simon.

Larry Bruno: I think we’ve got a little bit of a crowded earnings release date. So since we’re not seeing any other questions, we’ll end right there. In summary, Core’s operational leadership continues to position the company for improving client activity levels in both the U.S. and international markets for 2023 and beyond. We have never been better operationally or technologically positioned to help our global client base, optimize their reservoirs and to address their evolving needs. We remain uniquely focused and are the most technologically advanced client-focused reservoir optimization company in the oilfield service sector. The company will remain focused on maximizing free cash and returns on invested capital. In addition to our quarterly dividends, we’ll bring value to our shareholders via growth opportunities, driven by both the introduction of problem-solving technologies and new market penetration.

In the near-term, Core will continue to use free cash to strengthen its balance sheet and while always investing in growth opportunities. So in closing, we thank and appreciate all of our shareholders and the analysts that cover Core Lab. The executive management team and the Board of Core Laboratories give a special thanks to our worldwide employees that have made these results possible. We’re proud to be associated with their continuing achievements. So thanks for spending time with us, and we look forward to our next update. Goodbye for now.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.