Superior Drilling Products, Inc.

Greetings and welcome to the Superior Drilling Products Incorporated second quarter 2021 financial results call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Deborah Pulaski, Investor Relations for Superior Drilling.

Thank you, Victor, and hello, everyone. We certainly appreciate your time today and your interest in Superior Drilling products. I have with me on the call Troy Meyer, our Chairman and CEO, and Chris Cashin, our Chief Financial Officer. Troy and Chris will go through their prepared remarks discussing our second quarter of 2021 results, and talk a little bit about the market conditions and what we're seeing here today. Then we will open the call for questions. You should have a copy of the financial results that we released before the market this morning and should also have the slides that will accompany our conversation today. You can find both of those documents on our website at sdpi.com. If you would turn to slide two, I will point out that we may make some forward-looking statements during the formal discussions as well as during the Q&A session today. These statements apply to future events that are subject to risks and uncertainties, as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties are provided in the earnings release, the slides, and other documents filed by the company with securities and exchange commission. All of these documents can be found on our website or at sec.gov. I want to also point out that during today's call, we will discuss some non-GAAP financial measures, which we believe will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP with comparable GAAP measures in the tables accompanying the earnings release as well as in the slide deck. So with that, if you would turn to slide three, you will see Troy's name, and I will let him begin.

Troy? Thanks, Deb. Thank you. Thanks, everyone, for joining us. We go into our second quarter 2021 conference call. We're going to be talking about a lot of exciting opportunities and also talking about some strong, very strong business growth that we see here at Superior. When you look at what's driving the demand for what we do, it's the North America market. You look at North American, you look at it's up 74%, and what that does for our business is it drives every business unit that we have at Superior, whether it's, you know, the third-party machining, the PDC refurbishment, and when we talk about PDC refurbishment, you know, that's everything that we take, a certain skill set that we have here that our team is very good at doing, and it can be when we braze the PDCs into reamer blades, when we braze them into the DNR, when we braze them into the drill bits, that PDC refurbishment activity has been very busy. There's some exciting stuff going on there, and we're real, as we manage this, growth spurt. It's exciting to see how people are relying more and more on us all the time to produce a high-quality product, a brazed product that we've been providing for so long here at Superior. If you look at our third-party drilling tool manufacturing business, that's the machine shop. That's the high-end machines that we talk about. We've got you know, we brag on our staff here, you know, as we brag on our team here that does the PDC refurbishment. I also like to brag on the team that we have developed in our machining side of things. It's a very unique team. These people over there are programming machines, they're running machines, they're understanding, you know, tooling cuts, types of tooling that we need. They take CAD files from our larger customers and help them out with those files to convert those to match the drawings that they've asked us to produce. And again, in that part of our business, companies are relying on us more and more to provide them with these services. And we'll talk more about that in future opportunities here after we go through the financial side of things. And when you look at the increased drilling activity in North America, you know, it's great for driving the DNR demand. The DNR is a wonderful tool that operators are finding, help them with, you know, create good wellbore and drilling good wellbore qualities, and it also helps them with the longevity of their tools, their BHAs. There's a lot of reasons why people should be running a drill and ream, and more and more people are figuring that out as time goes on. When we're talking about drill and ream, I'd also like to talk about some of the things that drill and ream is allowing some of these operators to do. We just had a few weeks ago an operator drill a very unique profile well where they were able to go down because of acreage positions they were they could only go out on a 5,000 foot lateral but what they were able to do with with by running drill and ream was they were able to go down there 8,500 feet somewhere about there make their curve go straight out 5,000 feet bend to the left, go out another 2,500 feet, bend again to the left, come back another 5,000 feet. So totally changing the evaluation of that acreage that at one point in time would have been a 5,000-foot lateral was all you could do on there. This team went in and made a U-shaped well and did it to perfection. And I think that's going to be a new... advanced drilling process that we're going to see in some of these basins. It's really incredible what they did. We look at international opportunities and growth here. Our international revenue increased 37%. As you all know, we've talked about the issues that the Mideast is where our international activity is happening currently. And you all know that COVID was hit over there and lockdowns are still in place. When you look at people moving in and out of countries like Oman or Kuwait, it's still very restricted. So our team was able to still bring up that, increase that revenue, bring on new customers. We've got some exciting stuff going on with some high-profile customers that the team has done very well in breaking into those markets. And again, we'll talk about that on future opportunities. So when you look at all the stuff that has happened in Q2 to the business, and you'll see that in the financials here that Chris talks about, We're just getting started. We've got to grow this business back and get some good trained staff back in place. But lots of opportunity. But with that being said, I'm going to turn it over to Chris. Chris?