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National Energy Services Reunited Corp. ( NESR, the Company, we, our, us or similar terms) is one of the largest oilfield services providers in the Middle East and North Africa ( MENA ) region. The Company s business consists primarily of upstream and midstream oilfield services with oil and natural gas companies as customers.
Operating margin is thin at 7.43%. Limited cushion if revenue slows or costs rise, not the profile of a wide-moat business.
Revenue growth slowed to 1.7%, essentially flat. Margins also contracted 3.2pp. This is a business that needs a catalyst.
ROIC dropped from 8.99% to 6.79%, capital efficiency is deteriorating. Operating margin contracted 3.2pp YoY, cost discipline may be slipping.
Profitability & Returns
Revenue (FY)
$1.32B
▲ +1.7% YoY
Net Income (TTM)
$47M
▼ -33.0% YoY
Op. Margin
7.43%
▼ -3.2pp YoY
ROIC
10.42%
▼ -2.2pp YoY
Cash Flow & Balance Sheet
FCF (FY)
$121M
▼ -2.8% YoY
Op. Cash Flow (FY)
$264M
▲ +15.2% YoY
Net Debt
$219M
Cash & Equiv.
$93M
5Y CAGR: +9.7%
5Y CAGR: +3.7%
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