Expro Group Holdings N.V. Q3 FY2025 earnings call

• Expro achieved its highest quarterly free cash flow ever and improved EBITDA margin.
• $2.3 billion backlog provides revenue visibility.
• Despite softer commodity prices, core markets remain constructive with upstream investment expected to recover later in 2026.
• Operational highlights include winning ENI's Best Contractor HSE Performance award, OTC Brasil Spotlight on New Technology awards, and setting a new offshore world record for casing string deployment.
• Production solutions business maturing into a free cash flow generator.
• Commitment to technology leadership with investments in digitalization and AI to deliver innovative solutions.

North and Latin America (NLA) had Q3 revenue of $151 million, an increase of $8 million quarter-over-quarter. Europe and Sub-Saharan Africa (ESSA) saw Q3 revenue decrease by $7 million to $126 million quarter-over-quarter. Middle East and North Africa (MENA) had Q3 revenue of $86 million, slightly lower than Q2. Asia Pacific (APAC) had Q3 revenue of $49 million, a decrease of $8 million relative to the second quarter. Segment EBITDA margin for NLA was 32% (up 200 basis points sequentially), ESSA was 32% (up 200 basis points sequentially), MENA was 35% (down ~100 basis points from prior quarter), and APAC was 21% (down ~500 basis points from prior quarter).

• Raised 2025 adjusted EBITDA guidance to between $350 million and $360 million, lowered capital expenditures guidance to between $110 million and $120 million, and increased free cash flow guidance to between $110 million and $120 million.
• 2026 activity levels are expected to be consistent or slightly lower than 2025 levels, with activity likely increasing in the second half of 2026.
• Margin expansion in 2026 is driven by the full year effect of the Drive 25 initiative, international M&A integration, and technology rollout.

• Macroeconomic risks such as commodity price fluctuations.
• Geopolitical uncertainties that could impact upstream investment.
• Market conditions that may affect operational activity and revenue.

Q: Ati Modak asks about margin expansion drivers for 2026.

A: Michael Jardon mentions the full year effect of the Drive 25 initiative, internationalization of M&As (Coretrax), and technology rollout.

Q: Ati Modak asks about offshore activity pickup.

A: Michael Jardon talks about Asia Pacific being a laggard, Golden Triangle, West Africa, Gulf of Mexico, Saudi jack-up activity, and Mexico activity.

Q: Edward Kim asks about 2026 activity softness in the first half.

A: Michael Jardon discusses customer cautiousness, Q1 seasonality, and Asia Pacific softness due to winter season and NOC planning.

Q: Derek Podhaizer asks about production solutions.

A: Michael Jardon and Sergio Maiworm talk about brownfield projects, cash generation from existing facilities like the OPT project in Congo.

Q: Joshua Jayne asks about margin uplift from the Middle East.

A: Michael Jardon talks about mix impact, technology rollout, and Middle East presence.

Q: Joshua Jayne asks about technology deployment.

A: Michael Jardon discusses the Remote Clamp Installation System's scalability and expected ramp-up in 2026 and 2027.