Newpark Resources, Inc.

Greetings. Welcome to New Park Resources' fourth quarter and full year 2022 earnings conference 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, Mr. Ken Dennard. Thank you, sir. You may begin.

Thank you, operator, and good morning, everyone. We appreciate you joining us for the New Park Resources conference call and webcast to review fourth quarter and full year 2022 results. Participating from the company in today's call are Matthew Lanigan, New Park's president and chief executive officer, and Greg Piontek, chief financial officer. Following my remarks, management will provide a high-level commentary on the financial details of the fourth quarter results and near-term outlook before opening the call to Q&A. Before I turn over the call, I have a few housekeeping items to run through. There'll be a replay of today's call. It'll be available on the company's website at newpark.com. There'll also be a recorded replay telephonically until March 3rd, 2023, and that information on how to access is included in yesterday's release. Please note the information reported on this call speaks only as of today, February 17, 2023, and therefore you're advised that time-sensitive information may no longer be accurate at the time of any replay listening or transcript reading. In addition, comments made by management during this conference call may contain forward-looking statements within the meaning of the United States federal securities laws. These forward-looking statements reflect the current views of New Parks management. However, various risks, uncertainties, and contingencies could cause New Parks actual results, performance, or achievements to differ materially from those expressed in the statements made by management. The listener is encouraged to read the annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K to understand certain of those risks, uncertainties, and contingencies. The comments today may also include certain non-GAAP financial measures. Additional details and reconciliation to the most directly comparable GAAP financial measures are included in the quarterly earnings release, which can be found on the New Park website. And now with that behind me, I'd like to turn the call over to New Park's President and CEO, Mr. Matthew Lanigan. Matthew?

Good morning, everyone. The fourth quarter provided a strong finish to 2022 for the company. with a successful closure of our key strategic divestitures and solid operating performances across our ongoing business segments. As we stated earlier last year, we had three primary objectives for 2022. One, monetize their investments in asset-heavy, low-returning business units. Two, reduce debt levels. And three, reposition the company for stronger returns and more consistent free cash flow generations. These structural actions enhance our flexibility to accelerate investment in high returning opportunities, while also allowing us to re-engage in our share repurchase program, returning a portion of cash generation to our shareholders. In Q4, we delivered on all three objectives, generating $80 million of cash from divestitures, investing $9 million of growth capital in our MAT fleet, using $18 million to purchase nearly 5% of our outstanding shares, and exiting the year with net debt at roughly one times our EBITDA run rate. With these transactions largely behind us, New Park is a simpler business with all our served markets enjoying very supportive fundamentals, and we are well positioned for a stronger 2023 performance as a result. In terms of fourth quarter operational performance, consolidated revenues grew 2% sequentially to $225 million, driven by double-digit growth in our industrial segment, while adjusted EBITDA improved 9% sequentially to $21 million. The continuing strength of the electrical utility infrastructure market was a particular highlight, where robust demand and favourable weather conditions led to very strong utilisation and improving pricing dynamics across our US operations. Total segment revenues came in at $57 million, generating an exceptional operating margin of 31% and adjusted EBITDA of $23 million. I am very pleased that our team delivered sequential growth in revenues and operating income while continuing to generate solid cash flows. The consistency of our returns and cash flows validates our unique value proposition in the market and our prioritization of capital to the expansion of our geographic footprint where we see a meaningful runway for continued growth. In fluid systems, while there were many moving parts during the quarter, our ongoing North American land and international business units grew 4% sequentially, delivering $148 million of revenues and a 5.2% operating margin, largely in line with our expectations. With the completion of the divestitures, we remain confident that our serve markets are underpinned by a strong investment upcycle. particularly in key international markets where we are well-placed to benefit. To further strengthen our position during the cycle, we will maintain a rigorous focus on capital discipline and margin improvement across our fluids portfolio, limiting strategic capital investments to markets that demonstrate solid returns. Our fourth quarter clearly demonstrates that our efforts to streamline and simplify our business and our ongoing focus on improving returns to take advantage of robust market fundamentals in both segments are delivering. We believe that we are well positioned moving forward to balance investment in profitable growth opportunities while also returning value to shareholders via share repurchases. And now, I'd like to hand the call over to Greg to provide more color on the specifics of the financials for the quarter. Greg?