National Energy Services Reunited Corp. press release

National Energy Services Reunited Corp. Reports First Quarter 2026 Financial Results

2026-05-11

NASDAQ - Nasdaq Stock Market · Oil · Natural Gas · United States · Corporate Finance

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Revenue for the quarter ended March 31, 2026, is $404.6 million, reflecting an increase of 33.5% year-over-year and 1.6% sequentially

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Net income for the quarter ended March 31, 2026, is $23.8 million, improving 205.4% sequentially and 129.3% year-over-year

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Diluted Earnings per Share (EPS) for the three months ended March 31, 2026 is $0.23, representing an increase of 109.1% year-over-year and 201.3% sequentially

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Adjusted EBITDA (a non-GAAP measure) for the quarter ended March 31, 2026, is $76.7 million, improving 22.7% year-over-year

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Operating cash flow for the quarter ended March 31, 2026, is $30.7 million, growing 50.1% year-over-year

HOUSTON, TX / ACCESS Newswire/ May 11, 2026 / National Energy Services Reunited Corp. ("NESR" or the "Company"), a leading integrated energy services provider in the Middle East and North Africa ("MENA"), today announced its financial results as of and for the three-month period ended March 31, 2026. The Company delivered the following results for the periods presented:

| | | Three Months Ended | | Variance | | | | | | | | | | | | | | (in thousands except per share amounts and percentages) | | March 31, 2026 | | December 31, 2025 | | March 31, 2025 | | Sequential | | Year- over- year | | | | | | | | | | | | | | | | | | | | | | | | | | Revenue | | $ | 404,586 | | $ | 398,262 | | $ | 303,102 | | | 1.6 | % | | 33.5 | % | | Net income | | | 23,827 | | | 7,803 | | | 10,391 | | | 205.4 | % | | 129.3 | % | | Adjusted net income (non-GAAP) | | | 26,733 | | | 31,879 | | | 12,963 | | | (16.1 | )% | | 106.2 | % | | Adjusted EBITDA (non-GAAP) | | | 76,671 | | | 84,414 | | | 62,463 | | | (9.2 | )% | | 22.7 | % | | Diluted EPS | | | 0.23 | | | 0.08 | | | 0.11 | | | 201.3 | % | | 109.1 | % | | Adjusted Diluted EPS (non-GAAP) | | | 0.26 | | | 0.32 | | | 0.14 | | | (17.8 | )% | | 85.7 | % |

The Company presents its financial results in accordance with generally accepted accounting principles in the United States of America ("GAAP"). However, management believes that using additional non-GAAP measures will enhance the evaluation of the profitability of the Company and its ongoing operations. Please see Tables 1, 2, 3, and 4 below for reconciliations of GAAP to non-GAAP financial measures. The Consolidated Balance Sheets, Consolidated Statements of Operations, and Consolidated Statements of Cash Flows are derived from the consolidated financial statements presented in our Quarterly Report on Form 10-Q as of and for the three months ended March 31, 2026.

Stefan Angeli, Chief Financial Officer, commented, "First Quarter 2026 delivered outstanding results despite the geopolitical conflict with strong operational execution driving continued growth and profitability. Revenue reached $404.6m, an all-time high, supported by sustained activity across our core markets and increasing contributions from our hydraulic fracturing operations, particularly in our Saudi Arabia's Jafurah unconventional field.

Net income increased to $23.8 million, underscoring the growing earnings power of the business as we scale. Adjusted EBITDA is $76.7 million, demonstrating the resilience of our operating model and the benefits of disciplined execution, even against a significantly more complex operating backdrop. We generated $30.7 million of operating cash flow while absorbing working capital build related to Ramadan and higher activity, with net debt broadly stable versus year-end and free cash flow largely in line with the prior year quarter. We continue to execute at scale and capitalize on the multi-year opportunity set in the region."

Sherif Foda, Chairman and Chief Executive Officer, commented, "Amid an escalation in regional security tensions driven by recent conflict in the Middle East, NESR delivered a strong start to 2026, underpinned by resilient operations and continued client trust across our core markets. We maintained uninterrupted activity at scale, supported by secure supply chains, localized capabilities, and proven operational agility. We focused on the reliable supply of inventory and products to maintain operating capacity and capabilities despite the logistics challenges and sharp increase of costs. Recent multi-year contract awards in Kuwait and North Africa further reinforce our competitive positioning and long-term growth visibility. We reiterate our commitment to the clients by being physically by their side, and I visited the majority of our operating units across the region as we see accelerated investment potential to diversify and increase both Oil and Gas capacity in the region."

Net Income and Adjusted Net Income Results

Net income for the quarter ended March 31, 2026, is $23.8 million, increasing $16.0 million sequentially and $13.4 million year-over-year. The increases were primarily attributable to strong flow-through from incremental revenue generated by higher activity levels in the Company's hydraulic fracturing and well testing service lines.

Adjusted net income for the quarter is $26.7 million and included $2.9 million of "Total Charges and Credits impacting Adjusted Net Income and Adjusted Diluted EPS," primarily attributable to $2.1 million of other write-offs (recoveries) and provisions (releases of provisions). The $2.1 million includes $3.6 million of foreign currency transaction remeasurement losses, partially offset by a $1.3 million favorable adjustment to the Company's lease accounting provisions. A detailed reconciliation of net income and diluted EPS to Adjusted Net Income and Adjusted Diluted EPS, including a complete list of adjusting items, is presented in Table 1 below under "Reconciliation of Net Income and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS."

The Company reported $0.23 of diluted EPS for the quarter ended March 31, 2026, improving $0.15 sequentially and $0.12 year-over-year. Adjusted for the impact of Total Charges and Credits impacting Adjusted Net Income and Adjusted Diluted EPS, Adjusted Diluted EPS, a non-GAAP measure described in Table 1 below, for the quarter ended March 31, 2026, is $0.26.

Adjusted EBITDA Results

The Company produced Adjusted EBITDA of $76.7 million during the quarter ended March 31, 2026, up 22.7% year-over-year. Adjusted EBITDA includes adjustments for certain Total Charges and Credits impacting Adjusted EBITDA (those not related to interest, taxes, and/or depreciation and amortization). The Company posted the following results for the periods presented:

| (in thousands) | | Quarter ended

March 31,

2026 | | | Quarter ended

December 31,

2025 | | | Quarter ended

March 31,

2025 | | | | | | Revenue | | $ | 404,586 | | | $ | 398,262 | | | $ | 303,102 | | | Adjusted EBITDA | | $ | 76,671 | | | $ | 84,414 | | | $ | 62,463 | |

A detailed reconciliation of net income to Adjusted EBITDA, including a complete list of adjusting items, is presented in Table 2 below under "Reconciliation of Net Income to Adjusted EBITDA."

Balance Sheet

Cash and cash equivalents were $93.0 million as of March 31, 2026, compared to $124.8 million as of December 31, 2025, and $78.7 million as of March 31, 2025.

Free cash flow, a non-GAAP measure, for the quarter ended March 31, 2026, is negative $5.3 million, compared to negative $9.6 million for the same period in 2025. The increase is primarily attributable to higher net income in 2026 as compared to 2025, partially offset by higher capital expenditures during the three months ended March 31, 2026. A reconciliation of the applicable GAAP measures to free cash flow is presented in Table 3, titled "Reconciliation of Net cash provided by (used in) operating activities to Free Cash Flow."

Total debt as of March 31, 2026, is $287.4 million, of which $111.9 million is classified as short-term, compared to $310.1 million and $118.8 million, respectively, as of December 31, 2025. Net Debt, a non-GAAP measure defined as current installments of long-term debt, short-term borrowings, and long-term debt, less cash and cash equivalents, totaled $194.4 million as of March 31, 2026, compared to $185.3 million as of December 31, 2025. The increase in Net Debt is primarily driven by lower cash and cash equivalents at March 31, 2026, relative to December 31, 2025, reflecting seasonal cash and working capital requirements. A reconciliation of the applicable GAAP measures to Net Debt is presented in Table 4, "Reconciliation to Net Debt."

In May 2026, the Company's has approved a capital return program consisting of (i) a quarterly cash dividend anticipated to commence in the fourth quarter of 2026 at an expected rate of $0.10 per Ordinary Share and (ii) authorization for the repurchase of up to $50.0 million of the Company's Ordinary Shares from time to time in open market transactions, privately negotiated transactions, or otherwise, at prevailing market prices, and subject to market conditions, applicable legal requirements, and liquidity considerations.

About National Energy Services Reunited Corp.

Founded in 2017, NESR is one of the largest national oilfield services providers in the MENA and Asia Pacific regions. With over 7,000 employees, representing more than 60 nationalities in 16 countries, the Company helps its customers unlock the full potential of their reservoirs by providing Production Services such as Hydraulic Fracturing, Cementing, Coiled Tubing, Filtration, Completions, Stimulation, Pumping and Nitrogen Services. The Company also helps its customers to access their reservoirs in a smarter and faster manner by providing Drilling and Evaluation Services such as Drilling Downhole Tools, Directional Drilling, Fishing Tools, Testing Services, Wireline, Slickline, Drilling Fluids and Rig Services.

Conference Call

A conference call is scheduled for 8:00 AM ET on May 11, 2026, to discuss the financial results. Investors, analysts and members of the media are invited to participate by dialing in to the U.S. toll-free line at 1-877-407-0890 or the international line at 1-201-389-0918, approximately 10 minutes prior to the start of the call.

A live, listen-only earnings webcast will also be broadcast simultaneously under the "Investors" section of the Company's website at www.nesr.com. Following the end of the conference call, a replay will be available after the event under the "Investors" section of the Company's website.

Forward-Looking Statements

This communication contains forward-looking statements (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). Any and all statements contained in this communication that are not statements of historical fact, may be deemed forward-looking statements. Terms such as "may," "might," "would," "should," "could," "project," "estimate," "predict," "potential," "strategy," "anticipate," "attempt," "develop," "plan," "help," "believe," "continue," "intend," "expect," "future," and terms of similar import (including the negative of any of these terms) may identify forward-looking statements. However, not all forward-looking statements may contain one or more of these identifying terms. Forward-looking statements in this communication may include, without limitation, the plans and objectives of management for future operations, projections of income or loss, earnings or loss per share, capital expenditures, dividends, capital structure or other financial items, the Company's future financial performance, expansion plans and opportunities, completion and integration of acquisitions, and the assumptions underlying or relating to any such statement.

The forward-looking statements are not meant to predict or guarantee actual results, performance, events or circumstances and may not be realized because they are based upon the Company's current projections, plans, objectives, beliefs, expectations, estimates and assumptions and are subject to a number of risks and uncertainties and other influences, many of which the Company has no control over. Actual results and the timing of certain events and circumstances may differ materially from those described by the forward-looking statements as a result of these risks and uncertainties. Factors that may influence or contribute to the accuracy of the forward-looking statements or cause actual results to differ materially from expected or desired results may include, without limitation: catastrophic events, geopolitical conflict, the level of capital spending by our customers, political, market, financial and regulatory risks, including those related to the geographic concentration of our operations and customers, our operations, including maintenance, upgrades and refurbishment of our assets, may require significant capital expenditures, which may or may not be available to us, operating hazards inherent in our industry and the ability to secure sufficient indemnities and insurance, our ability to successfully integrate acquisitions, competition, including for capital and technological advances, and other risks and uncertainties set forth in the Company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the "SEC").

You are cautioned not to place undue reliance on forward-looking statements because of the risks and uncertainties related to them and to the risk factors. The Company disclaims any obligation to update the forward-looking statements contained in this communication to reflect any new information or future events or circumstances or otherwise, except as required by law. You should read this communication in conjunction with other documents which the Company may file or furnish from time to time with the SEC.

The preliminary financial results for the Company as of and for the three-month period ended March 31, 2026, included in this press release, represent the most current information available to management. The Company's actual results when disclosed in its subsequent Quarterly Report on Form 10-Q may differ from these preliminary results as a result of the completion of the Company's financial statement closing procedures, final adjustments, completion of the independent registered public accounting firm's audit procedures, and other developments that may arise between now and the disclosure of the final results.

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In US$ thousands, except share data)

| | | March 31, 2026 | | | December 31, 2025 | | | | | | | | | | | | | | | Assets | | | | | | | | | | Current assets | | | | | | | | | | Cash and cash equivalents | | $ | 92,956 | | | | 124,797 | | | Accounts receivable, net | | | 227,932 | | | | 178,020 | | | Unbilled revenue | | | 171,341 | | | | 121,186 | | | Service inventories | | | 96,206 | | | | 94,834 | | | Prepaid assets | | | 9,706 | | | | 13,237 | | | Retention withholdings | | | 26,214 | | | | 33,125 | | | Other receivables | | | 54,753 | | | | 54,511 | | | Other current assets | | | 10,513 | | | | 10,664 | | | Total current assets | | | 689,621 | | | | 630,374 | | | Non-current assets | | | | | | | | | | Property, plant and equipment, net | | | 476,154 | | | | 465,454 | | | Intangible assets, net | | | 42,434 | | | | 47,086 | | | Goodwill | | | 645,095 | | | | 645,095 | | | Operating lease right-of-use assets | | | 25,977 | | | | 20,300 | | | Other assets | | | 44,649 | | | | 43,210 | | | Total assets | | $ | 1,923,930 | | | $ | 1,851,519 | | | | | | | | | | | | | Liabilities and equity | | | | | | | | | | Liabilities | | | | | | | | | | Accounts payable and accrued expenses | | | 483,048 | | | | 421,064 | | | Current installments of long-term debt | | | 64,500 | | | | 64,500 | | | Short-term borrowings | | | 47,353 | | | | 54,250 | | | Income taxes payable | | | 30,843 | | | | 25,092 | | | Other taxes payable | | | 15,152 | | | | 12,351 | | | Operating lease liabilities | | | 1,984 | | | | 2,948 | | | Other current liabilities | | | 17,408 | | | | 24,715 | | | Total current liabilities | | | 660,288 | | | | 604,920 | | | | | | | | | | | | | Long-term debt | | | 175,542 | | | | 191,378 | | | Deferred tax liabilities | | | 918 | | | | 1,691 | | | Employee benefit liabilities | | | 36,971 | | | | 36,321 | | | Non-current operating lease liabilities | | | 22,683 | | | | 18,447 | | | Other liabilities | | | 32,319 | | | | 30,846 | | | Total liabilities | | | 928,721 | | | | 883,603 | | | | | | | | | | | | | Commitments and contingencies | | | | | | | | | | | | | | | | | | | | Equity | | | | | | | | | | Preferred shares, no par value; unlimited shares authorized; none issued and outstanding at March 31, 2026, and December 31, 2025, respectively | | | - | | | | - | | | Ordinary shares and additional paid-in capital, no par value; unlimited shares authorized; 100,847,255, and 100,787,173 shares issued and outstanding at March 31, 2026, and December 31, 2025, respectively | | | 906,311 | | | | 902,845 | | | Retained income | | | 88,829 | | | | 65,002 | | | Accumulated other comprehensive income | | | 69 | | | | 69 | | | Total equity | | | 995,209 | | | | 967,916 | | | Total liabilities and equity | | $ | 1,923,930 | | | $ | 1,851,519 | |

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In US$ thousands, except share data and per share amounts)

| | | For the three-month

period ended | | | | | | | | Description | | March 31, 2026 | | | March 31, 2025 | | | | | | | | | | | | | | | Revenues | | $ | 404,586 | | | $ | 303,102 | | | Cost of services | | | (352,755 | ) | | | (265,647 | ) | | Gross profit | | | 51,831 | | | | 37,455 | | | Selling, general, and administrative expenses (excluding Amortization) | | | (11,103 | ) | | | (11,821 | ) | | Amortization | | | (4,693 | ) | | | (4,693 | ) | | Operating income | | | 36,035 | | | | 20,941 | | | Interest expense, net | | | (6,543 | ) | | | (8,284 | ) | | Other income, net | | | 1,449 | | | | 1,059 | | | Income before income tax | | | 30,941 | | | | 13,716 | | | Income tax expense | | | (7,114 | ) | | | (3,325 | ) | | Net income | | $ | 23,827 | | | $ | 10,391 | | | | | | | | | | | | | Weighted average shares outstanding: | | | | | | | | | | Basic | | | 100,803,435 | | | | 96,139,181 | | | Diluted | | | 102,931,550 | | | | 96,710,484 | | | | | | | | | | | | | Earnings per share: | | | | | | | | | | Basic | | $ | 0.24 | | | $ | 0.11 | | | Diluted | | $ | 0.23 | | | $ | 0.11 | |

NATIONAL ENERGY SERVICES REUNITED CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (In US$ thousands)

| | | For the three-month period ended | | | | | | | | | | March 31, 2026 | | | March 31, 2025 | | | | | Cash flows from operating activities: | | | | | | | | | | Net income | | $ | 23,827 | | | $ | 10,391 | | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | Depreciation and amortization | | | 33,779 | | | | 36,035 | | | Share-based compensation expense | | | 2,502 | | | | 1,856 | | | (Gain) on disposal of assets | | | (373 | ) | | | (363 | ) | | Non-cash interest (income) | | | (192 | ) | | | (143 | ) | | Deferred tax expense (benefit) | | | 1,132 | | | | (1,239 | ) | | Allowance for doubtful receivables and unbilled revenue | | | 480 | | | | (16 | ) | | Charges on obsolete service inventories | | | 853 | | | | 920 | | | Impairments and other charges | | | - | | | | 1,118 | | | Other operating activities, net | | | 25 | | | | 38 | | | Changes in operating assets and liabilities: | | | | | | | | | | (Increase) decrease in accounts receivable | | | (50,392 | ) | | | (27,524 | ) | | (Increase) decrease in unbilled revenue | | | (50,154 | ) | | | (18,339 | ) | | (Increase) decrease in retention withholdings | | | 6,910 | | | | 8,834 | | | (Increase) decrease in inventories | | | (2,224 | ) | | | (5,567 | ) | | (Increase) decrease in prepaid assets | | | 3,531 | | | | 746 | | | (Increase) decrease in other current assets | | | 429 | | | | (2,646 | ) | | (Increase) decrease in other long-term assets and liabilities | | | (1,934 | ) | | | 2,137 | | | Increase (decrease) in accounts payable and accrued expenses | | | 61,419 | | | | 15,094 | | | Increase (decrease) in other current liabilities | | | 1,127 | | | | (847 | ) | | Net cash provided by operating activities | | | 30,745 | | | | 20,485 | | | | | | | | | | | | | Cash flows from investing activities: | | | | | | | | | | Capital expenditures | | | (36,004 | ) | | | (30,124 | ) | | IPM investments | | | - | | | | - | | | Proceeds from disposal of assets | | | 402 | | | | 637 | | | Other investing activities | | | (833 | ) | | | (2,000 | ) | | Net cash used in investing activities | | | (36,435 | ) | | | (31,487 | ) | | | | | | | | | | | | Cash flows from financing activities: | | | | | | | | | | Proceeds from long-term debt | | | - | | | | - | | | Repayments of long-term debt | | | (16,125 | ) | | | (17,537 | ) | | Proceeds from short-term borrowings | | | 19,587 | | | | 26,841 | | | Repayments of short-term borrowings | | | (26,498 | ) | | | (26,252 | ) | | Payments on capital leases | | | (1,000 | ) | | | (710 | ) | | Payments on seller-provided financing for capital expenditures | | | (1,265 | ) | | | (601 | ) | | Other financing activities, net | | | - | | | | - | | | Net cash used in financing activities | | | (25,301 | ) | | | (18,259 | ) | | | | | | | | | | | | Effect of exchange rate changes on cash | | | - | | | | - | | | Net increase (decrease) in cash, cash equivalents, and restricted cash | | | (30,991 | ) | | | (29,261 | ) | | Cash and cash equivalents, beginning of period | | | 132,696 | | | | 107,956 | | | Cash, cash equivalents, and restricted cash, end of period | | $ | 101,705 | | | $ | 78,695 | |