Core Laboratories (CLB) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $130.6 million, up 2% year-over-year and 1% sequentially, driven by service revenue growth and stable product sales.

• Net income attributable to shareholders for Q2 2024 was $9.0 million, down 60% year-over-year but up 180% sequentially; diluted EPS was $0.19.

• Operating income for Q2 2024 was $16.0 million (ex-items: $16.4M, up 10% sequentially), with operating margin at 12% (ex-items: 13%).

• Free cash flow improved to $14.3M in Q2 and $16.8M for the first half; net debt reduced by $15.8M in Q2.

• Ongoing geopolitical conflicts and market volatility continue to impact demand and operations.

Financial highlights

• Q2 2024 revenue: $130.6M (Q1: $129.6M; Q2 2023: $127.9M); six-month revenue: $260.2M, up 2% year-over-year.

• Net income ex items: $10.4M, up 16% sequentially; GAAP net income: $9M.

• EPS ex items: $0.22 (Q1: $0.19; Q2 2023: $0.21); GAAP EPS: $0.19.

• EBIT ex items: $16.4M (up 10% sequentially), EBIT margin 13%.

• Free cash flow for Q2: $14.3M; for six months: $16.8M; net debt reduced by $15.8M to $132.3M.

Outlook and guidance

• Q3 2024 revenue projected at $131M–$137M; operating income $16.9M–$19.1M; EPS $0.23–$0.27.

• Reservoir Description Q3 revenue guidance: $86.5M–$89.5M; Production Enhancement: $44.5M–$47.5M.

• International upstream project activity expected to support growth; U.S. onshore activity anticipated to be lower.

• The company is expanding in energy transition projects, including carbon capture and geothermal.

• Near-term volatility expected due to geopolitical and economic risks.