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Core Laboratories (NYSE:CLB)
Q3 2021 Earnings Call
Oct 28, 2021, 8:30 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Operator

Good morning, and welcome to the Core Laboratories third quarter 2021 earnings conference call. All participants will be in a listen-only mode. [Operator instructions] After today's presentation there will be an opportunity to ask questions. [Operator instructions] Please note this event is being recorded.

I would now like to turn the conference over to Larry Bruno, chairman and CEO. Please go ahead.

Larry Bruno -- Chairman and Chief Executive Officer

Thanks, Debbie. Good morning in the Americas. Good afternoon in Europe, Africa, and the Middle East, and good evening in the Asia Pacific. We'd like to welcome all of our shareholders, analysts, and most importantly our employees to Core Laboratories' third quarter 2021 earnings call.

This morning I'm joined by Chris Hill, Core's chief financial officer; and Gwen Schreffler, Core's senior vice president and head of investor relations. The call will be divided into six segments. Gwen will start by making remarks regarding forward-looking statements. Will then have some opening comments, including a high-level review of important factors in Core's Q3 performance.

In addition, we'll review Core strategies and the three financial tenets that the company employs to build long-term shareholder value. Chris will then give a detailed financial overview and have additional comments regarding shareholder value. Following Chris, Gwen will provide some comments on the company's outlook and guidance. I'll then review course two operating segments detailing our progress and discussing the continued, successful introduction, and deployment of Core Lab technologies, as well as highlighting some of Core's operations and major projects worldwide.

Then we'll open the phones for the Q&A session. I'll now turn the call over to Gwen for remarks on forward-looking statements.

Gwen Schreffler -- Senior Vice President and Head of Investor Relations

Thank you, Larry. Before we start the conference this morning, I'll mention that some of the statements we made during this call may include projections, estimates, and other forward-looking information. This would include any discussion of the company's business outlook. These types of forward-looking statements are subject to a number of risks and uncertainties relating to the oil and gas industry, business conditions, international market, international political climate, and other factors including those discussed in our 34 Act filings, that may affect our outcome.

Should one or more of these risks, or uncertainties materialize, or should any of our assumptions prove incorrect? Actual results may vary in material respects from those projected in the forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainty. Please see item 1A-Risk Factors in our most recent annual report on Form 10-K, as well as other reports and registration statements filed by us with the SEC.

and the AFM. Our comments include non-GAAP financial measures reconciliation to the most directly comparable GAAP financial measures is included in the press release announcing our Q3 quarter results. These non-GAAP measures can also be found on our website. With that said I'll pass the discussion back to Larry.

Larry Bruno -- Chairman and Chief Executive Officer

Thanks, Gwen. Our thoughts remain with all those that continue to be affected by the global pandemic. During the third quarter, global caseloads rose and approached the highest levels recorded over the course of the pandemic. This negatively and unevenly impacted global commerce and continued to pose headwinds to oil field activities.

Still, global demand for hydrocarbons continues to rise and inventories continue to decline signaling positive trends for future oilfield activity. Virus-related issues are still causing unpredictable schedules in our clients' activities, travel complications, and logistical hurdles for field services and product shipments. A number of countries across our global operating network saw increasing COVID case counts and many countries maintained and acted, reenacted, or expanded precautionary measures during Q3. Despite these hurdles, Core remains ready to fully service our clients' needs and we see a gradually improving landscape for client activity.

During the third quarter, tropical weather systems resulted in disruptions in and along the Gulf of Mexico significantly reducing client activity for several weeks. Multiple Core Lab offices along the Gulf Coast were affected by storm-related closures and subsequent power outages many lasting four weeks. I'm happy to report that all of our employees are safe and that there was only minor temporary impact on the company's physical infrastructure. We appreciate the hard work of our employees along the Gulf Coast to both mitigate damage and spool up operations as quickly as possible.

Looking at Core Lab's performance in the third quarter of 2021, the company saw increased cash from operations and increased free cash flow. In addition, operating margins expanded in both segments during the quarter. At the same time, Core continued to execute on its strategic financial objectives by strengthening its balance sheet, reducing net debt, and improving its leverage ratio compared to the second quarter. Reservoir Description having greater international exposure continues to deal with the uneven progression of already committed projects worked as some clients are only now beginning to return to normal work schedules due to COVID-19 accommodations.

Now to review Core Lab's strategies and the financial tenants that Core is used to build shareholder value over our 26 plus year history as a publicly traded company. The interest of our shareholders, clients, and employees will always be well served by Core Labs' resilient culture, which relies on innovation leveraging technology to solve problems and dedicated customer service while we navigate through the current challenges. Core will remain focused on its three long-standing long-term financial tenets. Those being to maximize free cash flow, maximize return on invested capital, and return excess free cash to our shareholders.

Before we move on I want to thank Core's management team and employees for their hard work during the unprecedented challenges of the past 18 months. I also want to thank them for their dedication, loyalty, and adaptability in meeting all of our customers' needs. And for the personal sacrifices that many have endured, as we navigate the moment and prepare for a more active market. I'll now turn it over to Chris for the detailed financial review.

Chris Hill -- Chief Financial Officer

Thanks, Larry. Before we review the financial performance for the quarter, the guidance we gave on our last call in past calls specifically excluded the impact of any FX gains or losses and assumed an effective tax rate of 20%. So accordingly, our discussion today excludes any foreign exchange gain or loss for the current and prior periods. Additionally, the financial results for the third quarter of 2021 include a charge of $6.5 million for non-cash stock compensation expenses.

Associated with the future vesting of performance shares for certain employees who have reached their eligible retirement age. Although these performance shares, share awards continue to be subject to future vesting schedules and company financial performance metrics for recognition of the expenses required by US GAAP for employees when they attain their eligible retirement age. Now let's review the income statement. Revenue from continuing operations was $118 million in the third quarter, comparable to $118.7 million in the prior quarter and up 12% year over year.

Geographically the US market continued to grow, this was offset by a sequential decrease in international revenue. Year-over-year international revenue for the quarter is up 9% and the US is up almost 20%. As Larry mentioned earlier, there continue to be challenges with supply chains and workflow disruptions associated with the pandemic have also continued to have an impact on the progression of projects in our international operations and on international shipment of products. The third quarter results were also adversely impacted by the severe weather events in the Gulf of Mexico.

Of this revenue service revenue, which is more international was $84.8 million for the quarter down slightly from $86.3 million last quarter. The decrease in service revenue was primarily associated with the ongoing disruptions and delays caused by the pandemic in many regions outside the US but was also adversely impacted by the storms in the Gulf this quarter. Product sales which are more equally tied to the US and international activity were $33.2 million for the quarter up 2% sequentially coming off very strong growth in the second quarter. Our perforating and energetic products remain in high demand.

However, the growth in the sales to the US market in the third quarter was partially offset by a decrease in international sales. The second quarter included some large international orders, which can vary from quarter to quarter. It is also worth mentioning that challenges with supply chains for materials continue and did impede some growth opportunities during the quarter for both the US and international markets. Longer lead times in short supply for certain raw materials limited the growth in our manufacturing and production capabilities during the quarter.

Moving on to the cost of services ex-items for the quarter was 79% of service revenue and fairly consistent to the prior quarter. As discussed during our second quarter earnings call, the cost of services are expected to increase as we restore some temporary cost reduction measures previously put in place during the pandemic. As we progress further into the recovery with operational activity in our laboratory utilization improving and when employee costs are fully restored, our incremental margins on services will improve and trend toward historical norms. Cost of sales ex-items in the second quarter was just below 78% of revenue and has improved from 82% last quarter and for the last five consecutive quarters.

As product sales continue to grow. manufacturing efficiencies and absorption of fixed costs will also continue to improve. G&A ex-items for the quarter was $8.6 a point six million compared to last quarter of $9.7 million. Year-to-date, G&A is $26 million compared to $31 million for the same period last year.

As we progressed through 2021, the timing and extent to which we have restored and continue to restore employee compensation levels could also impact our G&A expense for the next few quarters. G&A ex-items for the full year of 2021 is expected to be between $35 million to $37 million, which is about a decrease of 10% from last year. Depreciation and Amortization for the quarter at $4.5 million was slightly lower compared to $4.8 million last quarter. EBIT ex-items for the quarter was $13 million comparable to last quarter and representing an EBIT margin of over 11%.

Our operating income for the quarter on a GAAP basis was $6.6 million, which was impacted by the accelerated accounting recognition of the non-cash stock compensation expense. Interest expense was $2.7 million comparable to last quarter, but down from $3.1 million in Q3 of 2020, as we continue to reduce long-term debt. Income tax expense ex-items in using a 20% effective tax rate was approximately $2.1 million for the quarter. On a GAAP basis, income tax expense was $3 million for the third quarter.

As mentioned earlier the third quarter includes $6.5 million of non-cash stock compensation expense that was recognized for accounting purposes and is not deductible for tax purposes. The recognition of this expense in the quarter also increased the effective tax rate for the third quarter. The effective tax rate will continue to be somewhat sensitive to the geographic mix of earnings across the globe and the impact of items discrete each quarter. However, for the fourth quarter of 2021, we continue to project a company's effective tax rate to be approximately 20%.

Income from continuing operations ex-items for the quarter was $8.3 million down slightly from $8.5 million last quarter. GAAP income from continuing operations was $1 million for the third quarter and includes the $6.5 million of stock compensation expense mentioned earlier. Earnings per diluted share from continuing operations ex-items was $0.18 for the quarter comparable to the last quarter. GAAP earnings per diluted share from continuing ops was $0.2% for the quarter.

Moving on to the balance sheet, receivables were 95.3 million and increased approximately $2 million from prior quarter. Our DSOs sales for the third quarter were 68 days up from 64 days last quarter. Inventory ended the quarter at 44.1 million up a little over 5 million from 38.9 million last quarter. Inventory turns for the quarter were 2.5 compared to 2.7 in the last quarter.

As previously highlighted last quarter, the company continues to experience longer lead times in the supply chain and increasing cost of raw materials and supplies and in some instances short supply. The majority of the increase in inventory this quarter is associated with carrying larger quantities of raw materials in an effort to help mitigate the challenges in the supply chain. Additionally, some larger international product sales anticipated to ship this quarter were delayed at some of the challenges with international shipments continued. On the liability side, our long-term debt was $190 million at the end of the third quarter of 2021 and considering cash of $19 million.

Net debt was reduced to $171 million or a decrease of $5.4 million from June 30. Our leverage ratio was 2.1 as of September 30, which is down from 2.18 last quarter and continues to improve as we work to delever the company. At September 30, $75 million of 10-year private placement notes, which were issued back in 2011 matured and we're retired. These notes were settled using a combination of $20 million from cash on hand and $55 million drawing from our credit facility.

Our debt is now comprised of $135 million in senior notes and $55 million outstanding on our credit facility. Our credit facility remains fully available with over $159 million in borrowing capacity. Looking at cash flow for the third quarter of 2021, cash flow from operating activities with $11.9 million and after paying for $3.1 million of capex for the quarter. Our free cash flow was 8.8 million, which is up from $6.6 million in the second quarter.

Excess-free cash was primarily used to reduce long-term debt and $2.6 million in repurchasing shares associated with our long-term share-based incentive programs. Capex for 2021 will continue to be aligned with activity levels and growth opportunities. The company continues to anticipate activity levels will build for the rest of the year and beyond. And we would also expect our capital expenditures to modestly increase, but remain in line with historical levels while in a period of growth.

For the full 2021 year, we expect capital expenditures to be in a range of $12 million to $14 million. Core will continue with strict capital discipline an asset-light business model with capital expenditures primarily targeted at growth opportunities and initiatives. This also marks another quarter where Core Lab generated positive free cash and we are projecting free cash to grow, as we look ahead to the remainder of this year and beyond. We believe evaluating a company's ability to generate free cash flow and free cash flow yield are important metrics for shareholders when comparing a company's financial road results particularly for those shareholders who utilize discounted cash flow models to assess valuations.

I will now turn it over to Gwen for an update on our guidance and outlook.

Gwen Schreffler -- Senior Vice President and Head of Investor Relations

Thank you, Chris. The global crude oil market continues to tighten as demand for crude oil approaches the pre-COVID level resulting in noticeable increases in the crude oil commodity prices. Current crude oil commodity prices should also support a higher level and more accelerated pace of investment and international offshore crude oil development projects for 2022 and beyond. These crude oil market fundamentals are reflected in the gradual increase in the international rig count with more oil field equipment coming under contract, as the cycle strengthens in IOCs, NOCs, and independence expand their investments in maintenance of existing fields, and development of new fields, or field extension.

We anticipate operators to increase capital spending by 15% to 20% for North America and double digits for international in 2022. Core is well-positioned to capitalize on this growth opportunity given our global presence and proprietary technologies. With core lab having more than 70% of its revenues exposed to international activity, both business segments remain active on international projects. As additional field developments emerge, wells need to be drilled and reservoir rock and fluid sampled before Reservoir Description more fully participate in the cycle.

As disruptions from the pandemic abate, the expansion of international development provides growth opportunities for both segments into 2022 and beyond with a particular focus on the South Atlantic margin, Latin America, and the Middle East. As Chris mentioned, international revenue was up 9% year over year for the third quarter. For the fourth quarter of 2021. Core expects continued growth in year-over-year international revenue.

Additionally, growth in US activity is projected to moderately progress as 2021 comes to a close. Core projects fourth quarter revenue to range from $121 million to $124 million. And operating income of $13 million to $15.5  million yielding operating margins of approximately 12%. As previously discussed in Core's prior earnings call financial performance and incremental margins will be temporarily impacted as some cost reduction measures announced in 2020 continue to be rolled back.

Once these costs are fully restored Core expects its historical incremental margin performance to return as client activity expands. EPS is for the fourth quarter of 2021 is expected to be approximately $0.18 to $0.22. In summary, Core remains committed to its strategic plan of expanding market penetration by introducing new technologies and targeting new market opportunities. Core remains focused on generating free cash flow and reducing net debt while maximizing return on invested capital.

As part of Core's 2021 strategic focus, the company will continue to invest in targeted client-driven technologies that aim to both solve problems and capitalize on Core's growth opportunities. The company remains well-positioned to meet the needs of its clients as the energy industry cycle unfolds. The company's fourth-quarter 2021 guidance is based on projections for underlying operation and excludes gains and losses in foreign exchange. Fourth-quarter 2021 guidance also assumes an effective tax rate of 20%.

Now I will return it back over to Larry.

Larry Bruno -- Chairman and Chief Executive Officer

Thanks, Gwen. First, I'd like to thank our global team of employees for providing innovative solutions, integrity, and superior service to our clients. The team's collective dedication to servicing our clients has been very visible during the current challenges and is the foundation of Core Lab success. Turning first a Reservoir Description, for the third-quarter revenue came in at $79 million up slightly sequentially.

Operating income ex-items was $8.6 million up 14% sequentially. And operating margins, ex-items improved to 11%. These segment improvements occurred despite disruptions caused by Gulf Coast storms and the global pandemic. By the nature of the business, Reservoir Descriptions' performance historically has lagged directional changes in client activity.

As industry activity recovers Reservoir Description will respond more slowly than say oilfield service companies with direct exposure to well construction and other early cycle clients spending. As we look ahead, we see the growing international rig count as a harbinger of an improving landscape for Reservoir Description. A trend that we project will play out throughout 2022 and beyond. Now to some operational highlights, during the third quarter of 2021, Core's advanced technology center in the United Kingdom launched an analytical program to provide both Core and fluid analysis on a client for a client operating in the North Sea.

Conventional core was recovered from sandstone strata in the targeted reservoir interval. Once the cores reached the rig floor upon recovery from the subsurface they were stabilized using proprietary Core Lab techniques, that ensured that the natural rock fabric and pour fluids were retained during handling and transportation. Upon arrival at the laboratory, the course was scanned using Core's proprietary, non-invasive testing and reservoir optimization technologies branded as nitro. Nitro includes proprietary, dual-energy, computed tomography, and high-resolution spectral gamma logging.

The results quickly provided Core's clients with little lodging information as well as a wide range of critical Petrophysical parameters for pay delineation. Nitro deliverables are normally available within a week of receiving the core. These initial analyses are being utilized in conjunction with Core's recently expanded machine-learning, artificial intelligence algorithms to refine and accelerate sample selection for the traditional time-honored physical measurements program. Single-phase subsurface reservoir fluid samples from the same North Sea well were also brought to the advanced technology center for testing.

The analysis included detailed determination of contamination levels from the drilling mud, compositional profiling of the hydrocarbons, speciation of sulfur compounds, and measurement of physical properties including density viscosity, gas-oil ratio, and bubble point. Quick turnaround, on the resulting rock and fluid analytical data sets, allowed Core's clients to make timely decisions supporting two upcoming sidetrack appraisal wells. In other international areas. Core's laboratory in Rio de Janeiro is now offering an expanded range of testing capabilities including many of course proprietary and patented technologies that are in high demand throughout Core's global client base.

These proprietary offerings include Core's dual-energy CT rock evaluation technologies and Core's automated digital imaging system, which robotically captures high-resolution images of the core material. The CT data sets and photographic images are being delivered to the clients via Core's proprietary, web-enabled data management system known as RAPID. these technologies and the RAPID data management system were utilized in the third quarter on Brazilian projects. Including a fully integrated study of Brazil's northeastern offshore basin.

This multiclient study incorporates stratigraphy, geochemistry, reservoir geology, and seal rock analysis across several offshore depot centers. With the Rapid data management system, multidisciplinary teams located around the globe are efficiently accessing data and collaborating on analytical results. Moving now to production enhancement or Core Lab strengths in both energetic systems and completion diagnostics help clients optimize their well completions. Revenue for production enhancement came in at $39.2 million down 3% sequentially.

That was driven by lower international sales compared to the second quarter plus some supply chain hurdles and the suspension of rig operations tied to weather events in the Gulf of Mexico. Operating income ex-items was $5 million up 29% sequentially. Operating margins were 30% for the third quarter of 2021 up over 320 basis points sequentially. Now for some operational highlights.

Oriented Perforating Technology is gaining widespread acceptance among US land operators as the preferred method to optimize frac stimulation. Testing shows that well performance is highly correlated to perforating gun alignment accuracy. Moreover, downhole images have shown suboptimal results from perforating systems that require manual alignment of guns in the gun string. During the third quarter, Core's production enhancement team was engaged by a Permian Basin operator to deploy Core's innovative patent-pending oriented go gun.

This next-generation design provides a plug-and-play system that removes inaccuracy is associated with the manual alignment of the guns as is required with other gun system offerings. In addition, the oriented go gun eliminates the need for orientation sub-assemblies greatly lowering assembly time. The innovative oriented go gun design results in the highest degree of alignment accuracy among externally oriented gun system offerings. Both from gun-to-gun and from stage-to-stage.

As a result of superior gun alignment and expedited string assemblies, the operator adopted the system for all the wells in their multiwell drilling pad. Also in the third quarter of 2021, Core's completion diagnostic services were called upon by a  Permian Basin and client to assess a new approach to cementing operations for their horizontal unconventional wells. It's often difficult to maintain stage containment when non-uniform cement placement has occurred resulting in channels behind pipe. Frac fluid can move along these channels and migrate between targeted intervals.

As a consequence, channels behind pipes can result in some targeted intervals being under-stimulated. The client wanted to evaluate if casing rotation while cementing would eliminate channels behind the pipe. Core utilizes proprietary spectra stem tracers and spectra scan logging technologies to compare the degree of frac fluid containment in a horizontal well in which casing rotation was employed during the cementing operation. That well was then compared to adjacent wells in which no casing rotation had been deployed.

Core's completion diagnostics engineers were able to confirm more uniform cement placement and better containment of frac fluid when pipe rotation was employed. In comparing oil production between the rotated pipe well and the wells in which no pipe rotation had been performed. The client observed an increase of 800 barrels of oil per thousand feet of treated well in just the first 80 days of production from the rotated pipe well. With these favorable results, the operator elected to implement pipe rotation in subsequent cementing operations.

Core's completion diagnostic technologies are an invaluable tool for assisting operators in their assessment of innovations and completion techniques. That concludes our operational review. We appreciate your participation and Debbie will now open the call for questions.

Questions & Answers:


Operator

[Operator instructions] The first question comes from Ian Macpherson with Piper Sandler. Please go ahead.

Gwen Schreffler -- Senior Vice President and Head of Investor Relations

Good morning Ian.

Ian Macpherson -- Piper Sandler -- Analyst

Good morning, everyone.

Larry Bruno -- Chairman and Chief Executive Officer

Good morning

Ian Macpherson -- Piper Sandler -- Analyst

Larry, when you -- when we think about the upstream spending growth rates that you're contemplating for next year, which are in the fold of what others are saying if not a little bit more conservative. We know that surface pricing needs to increase pretty substantially to recover the inflation that you're experiencing and so when you think about total spend minus OFS pricing, it doesn't seem to leave enough dollars left in the piggy bank for the requisite activity increase that we need to balance oil markets next year. So curious on your thoughts on how this unfolds with pricing recovery for Core Lab? And how do you think those spending growth rates that you talk about should translate toward your revenue opportunity next year in this inflationary context?

Larry Bruno -- Chairman and Chief Executive Officer

Yeah. OK. Good question Ian. So first, maybe frame where we think we're kind of what we're seeing today with our client conversations about our outlook coming going into next year for 2022.

So we'd say US activity is likely to grow 15% to 20%. Still, some conversations going on with both our domestic and international clients, but we think that's that's a reasonable growth rate that's going to occur in the US. And then, on the international side from what we see today where we're comfortable saying that it's going to grow double digits. And so I think we'll dial that in.

I think one of the things that certainly I think a need across the industry for improvement in pricing. I think that'll come. I think one of the unique situations with Core Lab is we've got a lot of operational leverage in our organization in that -- with the automation that we've put into the system. We can generate a substantial amount more revenue without having to grow our headcount proportionally.

So while I do think prices will firm up as demand and activity levels pick up, I think the way we've structured the company coming out of this call a period of upheaval has us well-positioned to see incremental margins start to trend back toward our traditional levels. That won't happen overnight and won't happen in one or two quarters, but we'll see that start to rise back into the call at 50% for Reservoir Description and call it 20% to 30% or a little bit more on the product side.

Ian Macpherson -- Piper Sandler -- Analyst

That's really helpful. Thanks, Larry. Now that you have -- the world is obviously your margins need, need, need some time to normalize. But just from total health of the market and demand growth respect to things normalize.

You've gotten your balance sheet on more solid footing than last year. How are you thinking about the opportunities strategically for the company with respect to M&A? Or other strategic opportunities for Core Lab in a market that's now positioned for growth rather than contraction? 

Larry Bruno -- Chairman and Chief Executive Officer

Sure. I'd say first of all our attention is always drawn toward our internal pipeline for technology development. It is a foundation for where we go. We've got a number of very intriguing technologies some including nuclear physics sort of revolutionary approach to how we'll address Core analysis in the future.

And then, on our product side a number of innovations both on diagnostics and energetic systems. So first our attention goes to growth opportunities we have and investment opportunities we have there. We're always looking and always listening to opportunities on the M&A side. I can say that we go through a rather rigorous evaluation of the technical and financial consequences of M&A, as we look at things we -- as you mentioned we now have called the balance sheet flexibility to act on those things.

The one thing I would say in terms of M&A as we look over the landscape of opportunities that are out there. If Core Lab acts on an M&A opportunity, it'll be something that you look at and go, well, that makes sense that sticks close to Core Lab's wheelhouse of things we know. What you won't see us do is get adventurous into things that have you scratching your head is why is Core Lab think they know anything about that?

Ian Macpherson -- Piper Sandler -- Analyst

Great answer. Hey thanks, Larry I'll pass it over.

Larry Bruno -- Chairman and Chief Executive Officer

OK. Sure. I think we've got a pretty full earnings release agenda this morning with other companies going so since there are no more questions we'll wrap up here. In summary, Core's operational leadership continues to position the company for improving client activity levels in both the US and international markets in 2022 and beyond.

We have never been better operationally or technologically positioned to help our global client base optimize their reservoirs and to address their evolving needs. We remain uniquely focused and are the most technologically advanced client-focused reservoir optimization company in the oilfield service sector. The company will remain focused on generating free cash and returns on invested capital. In addition to our quarterly dividends, we'll bring value to our shareholders.

The growth opportunities are driven by both the introduction of problem-solving technologies and new park market penetration. In the near term, Core will continue to use free cash to strengthen its balance sheet. So in closing, we thank and appreciate all of our shareholders and the analysts that cover Core Lab, the executive management team, and the board of Core Laboratories gives special thanks to our worldwide employees that have made these results possible. We're proud to be associated with their continuing achievements.

So thanks for spending time with us and we look forward to our next update. Goodbye for now.

Operator

[Operator signoff]

Duration: 40 minutes

Call participants:

Larry Bruno -- Chairman and Chief Executive Officer

Gwen Schreffler -- Senior Vice President and Head of Investor Relations

Chris Hill -- Chief Financial Officer

Ian Macpherson -- Piper Sandler -- Analyst

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