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Jun 30, 2021
Nabors Q2 2021 Earnings Report
Reported second quarter results, showing progress on goals and improved performance across segments.
Key Takeaways
Nabors reported Q2 2021 operating revenues of $489 million and an adjusted EBITDA of $117 million. The company made progress on its goals to generate free cash flow and reduce net debt.
Second quarter adjusted EBITDA was 9% higher than the first quarter, exceeding expectations.
The Lower 48 land drilling market grew by 16% on average in the second quarter.
Free cash flow generation was strong, driving further debt reduction.
The company expects continued increases in drilling activity both in the U.S. and internationally.
Forward Guidance
For the second half of 2021, Nabors expects further improvement in oilfield industry fundamentals, notwithstanding the challenges posed by the COVID Delta variant.
Positive Outlook
- Third quarter average Lower 48 rig count is expected to increase by four to six rigs over the second quarter average.
- Nabors expects third quarter Lower 48 drilling margins in line with the second quarter level.
- For the third quarter, for the U.S. Offshore and Alaska operations, the Company expects adjusted EBITDA similar to the second quarter.
- The Company expects third quarter Drilling Solutions adjusted EBITDA to increase versus the second quarter.
- The Company expects third quarter adjusted EBITDA for Rig Technologies above the second quarter level.
Challenges Ahead
- The third quarter outlook for the International segment includes a slight decline in rig count.
- Third quarter outlook for the International segment includes daily margins in line with the second quarter.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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