CORE LAB REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS
- 4% increase in full-year revenue
- 36% increase in full-year operating income
- Reduction of debt by $15 million in Q4 2023
- Down 6% sequentially in operating income, ex-items
- 14% decrease sequentially in GAAP EPS
Insights
The reported fourth quarter revenue increase of 2% sequentially and the full year revenue growth of 4% indicate a moderate upward trend for Core Laboratories, which is positive for investors seeking stable growth. However, the decline in fourth quarter operating income and earnings per share (EPS), both on a GAAP basis and excluding items, by 6% and 14% sequentially, respectively, raises concerns about the company's cost management and profitability in the short term. The reduction of debt by over 8% and the consistent generation of free cash flow are strong indicators of a solid financial strategy aimed at improving the balance sheet and reducing financial risk. The commitment to a quarterly dividend, despite its nominal value, signals confidence in the company's cash flow stability.
Long-term investors might be encouraged by the strategic operational efficiency priorities that drove a significant 36% increase in full-year operating income, ex-items. The focus on international growth opportunities, particularly in the Middle East and Latin America, suggests potential for market expansion and increased revenue streams, which could enhance shareholder value over time. However, geopolitical events and the associated disruptions in hydrocarbon trading patterns present a risk that needs to be closely monitored.
The resilience of Core Laboratories' Reservoir Description segment, despite geopolitical disruptions, reflects the company's strategic positioning in international markets, which account for about 80% of its revenue. The demand for reservoir rock and fluid analysis in these markets indicates a robust industry need for Core's services, which can be a growth catalyst. The successful deployment of proprietary technologies such as InvasionProfiler™ and HELIOS™ in high-profile projects exemplifies Core's competitive advantage in innovation and could attract new clients seeking advanced reservoir description and production enhancement solutions.
However, the decline in the Production Enhancement segment's full-year revenue by 3% underscores the challenges faced in the U.S. onshore market. The segment's reliance on complex completions in unconventional oil and gas reservoirs might be subject to volatility due to fluctuating domestic drilling and completion activities. The anticipated flat onshore U.S. drilling and completion activity for 2024 could limit growth prospects in this segment unless offset by increased market penetration of Core's proprietary technologies.
Core Laboratories' strategic focus on international upstream projects aligns with the broader industry outlook that anticipates increased crude-oil demand and the necessity for further development of onshore and offshore fields. This suggests that the company is well-positioned to benefit from the expected sustainable activity growth in the energy sector. However, global crude-oil market volatility, driven by recession fears and geopolitical conflicts, particularly in Russia-Ukraine and the Middle East, presents a significant risk factor that could affect Core's operations and financial performance.
The company's emphasis on maximizing return on invested capital (ROIC) and free cash flow is in line with industry best practices and could be a key differentiator in driving long-term shareholder returns. The improvement in ROIC to 13.4% is a positive indicator of efficient capital utilization. Investors should consider the potential impact of Core's asset-light business model and disciplined capital stewardship on its ability to navigate the cyclical nature of the energy sector.
- FOURTH QUARTER REVENUE OF
$128.2 MILLION 2% SEQUENTIALLY - FOURTH QUARTER OPERATING INCOME OF
$14.6 MILLION $15.0 MILLION 6% SEQUENTIALLY - FOURTH QUARTER OPERATING MARGINS, EX-ITEMS, OF
12% - FOURTH QUARTER GAAP EPS OF
$0.14 $0.19 14% SEQUENTIALLY - FOURTH QUARTER FREE CASH FLOW OF
$16.7 MILLION - FOURTH QUARTER DEBT REDUCED BY
$15.0 MILLION 8% - COMPANY ANNOUNCES Q1 2024 QUARTERLY DIVIDEND
- FULL YEAR REVENUE OF
$510.0 MILLION 4% - FULL YEAR OPERATING INCOME OF
$54.6 MILLION $61.2 MILLION 36% - FULL YEAR GAAP EPS OF
$0.86 $0.80 40%
Core's CEO, Larry Bruno stated, "Our fourth quarter and full year financial results delivered modest revenue growth, highlighted by continued strong global demand for our Reservoir Description laboratory services. Additionally, demand for international energetic system product sales and completion diagnostics improved quarter-over-quarter. Reservoir Description experienced sequential growth in several geographic regions; however, that was partially offset by geopolitical events in the
Reservoir Description
Reservoir Description operations are closely correlated with trends in international and offshore activity levels, with approximately
During the fourth quarter of 2023, Core Laboratories Middle East Advanced Technology Center was selected by a prominent regional operator to quantify and de-risk their assessment of in-situ fluid saturations in a challenging carbonate reservoir. The operator recognized discrepancies between reserve estimates derived from down-hole log calculations and actual production outcomes from the targeted zones. Core Lab was asked to harness the collective expertise of both Reservoir Description and Production Enhancement to employ its proprietary, highly effective, InvasionProfiler™ drilling mud tracer technologies to address this problem. For this program, cores were cut in the target intervals to determine the fluid saturations in the rock. However, the coring process can alter saturations due to fluid exchange between the drilling mud and the pore space in the rock. By using a combination of drilling mud tracers from Core's Production Enhancement segment, along with proprietary laboratory technologies from Reservoir Description, Core's InvasionProfiler™ technology allowed the operator to accurately account for and quantify any fluid exchange that might have occurred. The fluids extracted from the core samples underwent thorough analysis using state-of-the-art gas chromatography-mass spectrometry to measure tracer concentrations. This meticulous analytical process corrected for any invasion of drilling mud filtrate, delivering very accurate determination of in-situ fluid saturations. The operator will use this core-based, tracer-corrected fluid saturation data to recalibrate their reservoir model.
Production Enhancement
Production Enhancement operations, which are focused on complex completions in unconventional oil and gas reservoirs in the
During the fourth quarter of 2023 Core Lab expanded its proprietary HELIOS™ product line of plug and abandonment perforating technologies, designed for oil and gas well decommissioning programs. When decommissioning a well in the North Sea, local regulations require a new, dedicated cement barrier be emplaced to fully isolate the wellbore. Core's engineering team was engaged to deploy HELIOS™ to increase efficiency for a plug and abandonment "perf-wash" operation. Existing competitive plug and abandonment technologies were unable to create the needed annular circulation patterns required to efficiently remove the old cement. HELIOS™ provides a higher shot density, optimizing flow between perforations with 360° annular coverage. This technology generates an array of perforations that minimizes fluid flow tortuosity, yielding faster and more efficient perf-wash operations. The HELIOS™ family now consists of multiple configurations, offering clients higher perforation coverage compared to competitive technologies. Core's clients confirmed that the HELIOS™ technology provided a more effective flow path to the existing cement barrier in the annulus, resulting in a superior well abandonment solution. The expanded HELIOS™ product line demonstrates Core's commitment to developing new technologies for its clients throughout the lifecycle of a well.
Also during the fourth quarter of 2023, Core's diagnostic technologies were employed in both the U. S. and international markets to assess high-profile well completions. In the Gulf of
Liquidity, Free Cash Flow and Dividend
Core continues to focus on maximizing free cash flow ("FCF"), a non-GAAP financial measure defined as cash from operations less capital expenditures. For the fourth quarter of 2023, cash from operations was approximately
Core expects the Company to continue generating positive free cash in future quarters. As of December 31, 2023, Core reduced net debt by
On November 1, 2023, Core's Board of Directors ("Board") announced a quarterly cash dividend of
On January 31, 2024, the Board approved a cash dividend of
Return On Invested Capital
The Board and the Company's Executive Management continue to focus on strategies that maximize return on invested capital ("ROIC") and FCF, factors that have high correlation to total shareholder return. Core's commitment to an asset-light business model and disciplined capital stewardship promote capital efficiency and are designed to produce more predictable and superior long-term ROIC.
The Board has established an internal metric to demonstrate ROIC performance relative to the oilfield service companies listed as Core's Comp Group by Bloomberg, as the Company continues to believe superior ROIC will result in higher total shareholder return. Using Bloomberg's recently updated formula, the Company's ROIC for the fourth quarter of 2023 improved to
Industry and Core Lab Outlook and Guidance
For 2024, Core will continue to execute its strategic plan of technology investments targeted to both solve client problems and capitalize on Core's growth opportunities. As part of the strategic plan, the Company will remain focused on generating free cash, reducing debt and maximizing ROIC. Core Lab maintains its constructive outlook on international upstream projects for 2024 and anticipates sustainable activity growth in the years ahead to support crude-oil demand and energy security. Crude-oil demand increased in 2023 and is anticipated to continue growing in 2024. Consequently, increased investment in the development of onshore and offshore crude-oil fields will be required to maintain and grow hydrocarbon production. In the near-term, global crude-oil markets may remain volatile due to global recession fears and the uncertainties related to on-going conflicts in
As the international recovery continues, committed long-term upstream projects from the
Reservoir Description's first quarter 2024 revenue is projected to range from
The Company's first quarter 2024 revenue is projected to range from
The Company's first quarter 2024 guidance is based on projections for underlying operations and excludes gains and losses in foreign exchange. First quarter 2024 guidance also assumes an effective tax rate of
Earnings Call Scheduled
The Company has scheduled a conference call to discuss Core's fourth quarter 2023 earnings announcement. The call will begin at 7:30 a.m. CDT / 8:30 a.m. EDT on Thursday, February 1, 2024. To listen to the call, please go to Core's website at www.corelab.com.
Core Laboratories Inc. is a leading provider of proprietary and patented reservoir description and production enhancement services and products used to optimize petroleum reservoir performance. The Company has over 70 offices in more than 50 countries and is located in every major oil-producing province in the world. This release, as well as other statements we make, includes forward-looking statements regarding the Company's future revenue, profitability, business strategies and developments, demand for the Company's products and services and for products and services of the oil and gas industry generally, made in reliance upon the safe harbor provisions of Federal securities law. The Company's outlook is subject to various important cautionary factors, including risks and uncertainties related to the oil and natural gas industry, business and general economic conditions, including inflationary pressures, the ability to achieve the benefits of the redomestication of the parent company from
The Company undertakes no obligation to publicly update or revise any forward-looking statement to reflect events or circumstances that may arise after the date of this press release, except as required by law.
Visit the Company's website at www.corelab.com. Connect with Core Lab on Facebook, LinkedIn and YouTube.
CORE LABORATORIES INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) | |||||||||||||||||
Quarter Ended | % Variance | ||||||||||||||||
December 31, | September 30, | December 31, | vs. Q3-2023 | vs. Q4-2022 | |||||||||||||
REVENUE | $ | 128,210 | $ | 125,343 | $ | 127,571 | 2.3 % | 0.5 % | |||||||||
OPERATING EXPENSES: | |||||||||||||||||
Costs of services and product sales | 101,517 | 96,617 | 99,816 | 5.1 % | 1.7 % | ||||||||||||
General and administrative expense | 8,665 | 9,452 | 8,724 | (8.3) % | (0.7) % | ||||||||||||
Depreciation and amortization | 3,874 | 3,929 | 4,073 | (1.4) % | (4.9) % | ||||||||||||
Other (income) expense, net | (427) | 673 | (660) | NM | NM | ||||||||||||
Total operating expenses | 113,629 | 110,671 | 111,953 | 2.7 % | 1.5 % | ||||||||||||
OPERATING INCOME | 14,581 | 14,672 | 15,618 | (0.6) % | (6.6) % | ||||||||||||
Interest expense | 3,618 | 3,147 | 3,081 | 15.0 % | 17.4 % | ||||||||||||
Income before income taxes | 10,963 | 11,525 | 12,537 | (4.9) % | (12.6) % | ||||||||||||
Income tax expense (benefit) | 4,265 | 2,305 | 5,847 | 85.0 % | (27.1) % | ||||||||||||
Net income | 6,698 | 9,220 | 6,690 | (27.4) % | 0.1 % | ||||||||||||
Net income (loss) attributable to non- | 235 | (37) | (61) | NM | NM | ||||||||||||
Net income attributable to Core | $ | 6,463 | $ | 9,257 | $ | 6,751 | (30.2) % | (4.3) % | |||||||||
Diluted earnings per share | $ | 0.14 | $ | 0.19 | $ | 0.14 | (26.3) % | — % | |||||||||
Diluted earnings per share attributable to Core Laboratories Inc. | $ | 0.14 | $ | 0.19 | $ | 0.14 | (26.3) % | — % | |||||||||
Diluted weighted average common shares outstanding | 47,557 | 47,604 | 46,826 | (0.1) % | 1.6 % | ||||||||||||
Effective tax rate | 39 | % | 20 | % | 47 | % | NM | NM | |||||||||
SEGMENT INFORMATION: | |||||||||||||||||
Revenue: | |||||||||||||||||
Reservoir Description | $ | 84,628 | $ | 85,145 | $ | 78,124 | (0.6) % | 8.3 % | |||||||||
Production Enhancement | 43,582 | 40,198 | 49,447 | 8.4 % | (11.9) % | ||||||||||||
Total | $ | 128,210 | $ | 125,343 | $ | 127,571 | 2.3 % | 0.5 % | |||||||||
Operating income: | |||||||||||||||||
Reservoir Description | $ | 12,259 | $ | 12,992 | $ | 6,817 | (5.6) % | 79.8 % | |||||||||
Production Enhancement | 2,195 | 1,544 | 7,904 | 42.2 % | (72.2) % | ||||||||||||
Corporate and Other | 127 | 136 | 897 | NM | NM | ||||||||||||
Total | $ | 14,581 | $ | 14,672 | $ | 15,618 | (0.6) % | (6.6) % | |||||||||
"NM" means not meaningful | |||||||||||||||||
CORE LABORATORIES INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) | |||||||
Year Ended December 31, | % Variance | ||||||
2023 | 2022 | ||||||
REVENUE | 4.1 % | ||||||
OPERATING EXPENSES: | |||||||
Costs of services and product sales | 399,957 | 393,655 | 1.6 % | ||||
General and administrative expense | 40,259 | 38,117 | 5.6 % | ||||
Depreciation and amortization | 15,784 | 17,161 | (8.0) % | ||||
Other (income) expense, net | (850) | (722) | NM | ||||
Total operating expenses | 455,150 | 448,211 | 1.5 % | ||||
OPERATING INCOME | 54,640 | 41,524 | 31.6 % | ||||
Interest expense | 13,430 | 11,570 | 16.1 % | ||||
Income before income taxes | 41,210 | 29,954 | 37.6 % | ||||
Income tax expense (benefit) | (79) | 10,296 | (100.8) % | ||||
Net income | 41,289 | 19,658 | 110.0 % | ||||
Net income attributable to non-controlling interest | 350 | 205 | NM | ||||
Net income attributable to Core Laboratories Inc. | 110.5 % | ||||||
Diluted earnings per share | 107.1 % | ||||||
Diluted earnings per share attributable to Core Laboratories Inc. | 104.8 % | ||||||
Diluted weighted average common shares outstanding | 47,523 | 46,813 | 1.5 % | ||||
Effective tax rate | (0) % | 34 % | NM | ||||
SEGMENT INFORMATION: | |||||||
Revenue: | |||||||
Reservoir Description | 8.3 % | ||||||
Production Enhancement | 176,445 | 182,044 | (3.1) % | ||||
Total | 4.1 % | ||||||
Operating income: | |||||||
Reservoir Description | 79.2 % | ||||||
Production Enhancement | 12,519 | 16,351 | (23.4) % | ||||
Corporate and Other | 1,082 | 2,271 | (52.4) % | ||||
Total | 31.6 % | ||||||
"NM" means not meaningful | |||||||
CORE LABORATORIES INC. & SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) | |||||||||||||||||
% Variance | |||||||||||||||||
ASSETS: | December 31, | September 30, | December 31, | vs. Q3-2023 | vs. Q4-2022 | ||||||||||||
Cash and cash equivalents | $ | 15,120 | $ | 16,616 | $ | 15,428 | (9.0) % | (2.0) % | |||||||||
Accounts receivable, net | 109,352 | 104,053 | 106,913 | 5.1 % | 2.3 % | ||||||||||||
Inventories | 71,702 | 75,060 | 60,445 | (4.5) % | 18.6 % | ||||||||||||
Other current assets | 26,791 | 32,815 | 28,916 | (18.4) % | (7.3) % | ||||||||||||
Total current assets | 222,965 | 228,544 | 211,702 | (2.4) % | 5.3 % | ||||||||||||
Property, plant and equipment, net | 99,626 | 99,499 | 105,028 | 0.1 % | (5.1) % | ||||||||||||
Right of use assets | 53,842 | 53,101 | 52,379 | 1.4 % | 2.8 % | ||||||||||||
Intangibles, goodwill and other long-term assets, net | 216,165 | 211,270 | 209,245 | 2.3 % | 3.3 % | ||||||||||||
Total assets | $ | 592,598 | $ | 592,414 | $ | 578,354 | — % | 2.5 % | |||||||||
LIABILITIES AND EQUITY: | |||||||||||||||||
Accounts payable | $ | 33,506 | $ | 34,097 | $ | 45,847 | (1.7) % | (26.9) % | |||||||||
Operating lease liabilities | 10,175 | 9,794 | 11,699 | 3.9 % | (13.0) % | ||||||||||||
Other current liabilities | 43,791 | 40,359 | 45,589 | 8.5 % | (3.9) % | ||||||||||||
Total current liabilities | 87,472 | 84,250 | 103,135 | 3.8 % | (15.2) % | ||||||||||||
Long-term debt, net | 163,134 | 177,863 | 172,386 | (8.3) % | (5.4) % | ||||||||||||
Long-term operating lease liabilities | 42,076 | 40,903 | 38,305 | 2.9 % | 9.8 % | ||||||||||||
Other long-term liabilities | 65,845 | 59,948 | 75,574 | 9.8 % | (12.9) % | ||||||||||||
Total equity | 234,071 | 229,450 | 188,954 | 2.0 % | 23.9 % | ||||||||||||
Total liabilities and equity | $ | 592,598 | $ | 592,414 | $ | 578,354 | — % | 2.5 % | |||||||||
CORE LABORATORIES INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) | ||||||||
Year Ended December 31, | ||||||||
2023 | 2022 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 41,289 | $ | 19,658 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Stock-based compensation | 13,971 | 7,756 | ||||||
Depreciation and amortization | 15,784 | 17,161 | ||||||
Deferred income taxes | (14,623) | 433 | ||||||
Accounts receivable | (2,618) | (10,078) | ||||||
Inventories | (12,976) | (14,860) | ||||||
Accounts payable | (12,878) | 15,374 | ||||||
Other adjustments to net income | (3,160) | (10,488) | ||||||
Net cash provided by operating activities | 24,789 | 24,956 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (10,579) | (10,216) | ||||||
Net proceeds from life insurance policies and from insurance recovery | 3,375 | 4,260 | ||||||
Other investing activities | 552 | 2,100 | ||||||
Net cash used in investing activities | (6,652) | (3,856) | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Repayment of long-term debt | (211,000) | (131,000) | ||||||
Proceeds from long-term debt | 202,000 | 116,000 | ||||||
Equity related transaction costs | (4,068) | (411) | ||||||
Dividends paid | (1,868) | (1,853) | ||||||
Repurchase of common stock | (2,202) | (3,903) | ||||||
Other financing activities | (1,307) | (2,208) | ||||||
Net cash used in financing activities | (18,445) | (23,375) | ||||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | (308) | (2,275) | ||||||
CASH AND CASH EQUIVALENTS, beginning of year | 15,428 | 17,703 | ||||||
CASH AND CASH EQUIVALENTS, end of year | $ | 15,120 | $ | 15,428 | ||||
Non-GAAP Information
Management believes that the exclusion of certain income and expenses enables it to evaluate more effectively the Company's operations period-over-period and to identify operating trends that could otherwise be masked by the excluded Items. For this reason, management uses certain non-GAAP measures that exclude these Items and believes that this presentation provides a clearer comparison with the results reported in prior periods. The non-GAAP financial measures should be considered in addition to, and not as a substitute for, the financial results prepared in accordance with GAAP, as more fully discussed in the Company's financial statements and filings with the Securities and Exchange Commission.
Reconciliation of Operating Income, Net Income and Diluted Earnings Per Share Attributable to Core Laboratories Inc. (In thousands, except per share data) (Unaudited) | ||||||||||||
Operating Income | ||||||||||||
Quarter Ended | ||||||||||||
December 31, 2023 | September 30, 2023 | December 31, 2022 | ||||||||||
GAAP reported | $ | 14,581 | $ | 14,672 | $ | 15,618 | ||||||
Stock compensation (1) | — | — | (1,868) | |||||||||
Loss on lease abandonment and assets write-down (2) | — | 633 | — | |||||||||
ATM termination costs (3) | — | 455 | — | |||||||||
Redomestication costs | — | — | 246 | |||||||||
Foreign exchange losses (gains) | 468 | 238 | 691 | |||||||||
Excluding specific items | $ | 15,049 | $ | 15,998 | $ | 14,687 | ||||||
Net Income Attributable to Core Laboratories Inc. | ||||||||||||
Quarter Ended | ||||||||||||
December 31, 2023 | September 30, 2023 | December 31, 2022 | ||||||||||
GAAP reported | $ | 6,463 | $ | 9,257 | $ | 6,751 | ||||||
Stock compensation (1) | — | — | (1,494) | |||||||||
Loss on lease abandonment and assets write-down (2) | — | 505 | — | |||||||||
ATM termination costs (3) | — | 364 | — | |||||||||
Redomestication costs | — | — | 197 | |||||||||
Foreign exchange losses (gains) | 374 | 190 | 552 | |||||||||
Reversal of net deferred tax liabilities and effect of higher (lower) tax rate (5) | 2,072 | — | 3,341 | |||||||||
Excluding specific items | $ | 8,909 | $ | 10,316 | $ | 9,347 | ||||||
Diluted Earnings Per Share Attributable to Core Laboratories Inc. | ||||||||||||||||
Quarter Ended | Year ended | |||||||||||||||
December 31, | September 30, | December 31, | December 31, | |||||||||||||
GAAP reported | $ | 0.14 | $ | 0.19 | $ | 0.14 | $ | 0.86 | ||||||||
Stock compensation (1) | — | — | (0.03) | 0.09 | ||||||||||||
Loss on lease abandonment and assets write-down (2) | — | 0.01 | — | 0.04 | ||||||||||||
ATM termination costs (3) | — | 0.01 | — | 0.01 | ||||||||||||
Gain on life insurance policies (4) | — | — | — | (0.03) | ||||||||||||
Redomestication costs | — | — | — | — | ||||||||||||
Foreign exchange losses (gains) | 0.01 | 0.01 | 0.02 | — | ||||||||||||
Reversal of net deferred tax liabilities and effect of higher (lower) tax rate (5) | 0.04 | — | 0.07 | (0.17) | ||||||||||||
Excluding specific items | $ | 0.19 | $ | 0.22 | $ | 0.20 | $ | 0.80 | ||||||||
(1) The year ended December 31, 2023 includes reversals of stock compensation expense previously recognized due to a change in probability of performance condition for | ||||||||||||||||
(2) Includes the write-down of right of use assets and leasehold improvements and other exit costs associated with consolidation of certain facilities. | ||||||||||||||||
(3) Includes the write off of previously deferred costs upon termination of our "at-the-market offering" program ("ATM Program"). | ||||||||||||||||
(4) Includes gain on life insurance policies death benefit proceeds. | ||||||||||||||||
(5) The quarter and year ended December 31, 2023 includes the reversal of certain net deferred tax liabilities which will not be realized as a result of the Redomestication | ||||||||||||||||
Segment Information (In thousands) (Unaudited) | ||||||||||||
Operating Income | ||||||||||||
Quarter Ended December 31, 2023 | ||||||||||||
Reservoir | Production | Corporate and | ||||||||||
GAAP reported | $ | 12,259 | $ | 2,195 | $ | 127 | ||||||
Foreign exchange losses (gains) | 71 | 209 | 188 | |||||||||
Excluding specific items | $ | 12,330 | $ | 2,404 | $ | 315 | ||||||
Return on Invested Capital
Return on Invested Capital ("ROIC") is presented based on management's belief that this non-GAAP measure is useful information to investors and management when comparing profitability and the efficiency with which capital has been employed over time relative to other companies. The Board has established an internal metric to demonstrate ROIC performance relative to the oilfield service companies listed as Core's Comp Group by Bloomberg. ROIC is not a measure of financial performance under GAAP and should not be considered as an alternative to net income.
ROIC of
Free Cash Flow
Core uses the non-GAAP financial measure of free cash flow to evaluate its cash flows and results of operations. Free cash flow is an important measurement because it represents the cash from operations, in excess of capital expenditures, available to operate the business and fund non-discretionary obligations. Free cash flow is not a measure of operating performance under GAAP and should not be considered in isolation nor construed as an alternative consideration to operating income, net income, or cash flows from operating, investing, or financing activities, each as determined in accordance with GAAP. Free cash flow should not be considered a measure of liquidity. Moreover, since free cash flow is not a measure determined in accordance with GAAP and thus is susceptible to varying interpretations and calculations, free cash flow as presented may not be comparable to similarly titled measures presented by other companies.
Computation of Free Cash Flow (In thousands) (Unaudited) | ||||||||
Quarter Ended | Year Ended | |||||||
December 31, 2023 | December 31, 2023 | |||||||
Net cash provided by operating activities | $ | 19,429 | $ | 24,789 | ||||
Capital expenditures | (2,736) | (10,579) | ||||||
Free cash flow | $ | 16,693 | $ | 14,210 | ||||
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SOURCE Core Laboratories Inc
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