China Oilfield Svcs Ltd H

leaders, investors, and analysts, good afternoon. Thank you for joining us today for the China Oilfield Services Limited COSO First Quarter Earnings Conference Call. COSO is one of the world's largest innovative oilfield service providers. Our services span every stage of oil and gas exploration, development, and production. Our operations are categorized into four full segments, geophysical and engineering exploration, fueling services, well services, and marine support services. By leveraging our integrative capabilities, we provide clients with full lifecycle oil field solutions. We remain highly responsive to evolving trends in the international oil and gas markets, while step-by-step prioritizing technological innovation as our leading strategic driver. We continue to refine our lean cost control measures and actively promote the synergy between domestic and international markets, the so-called dual circulation strategy. We are committed to translating our premium equipment and technical prowess into a leading market position, striving to deliver robust performance to reward our shareholders and society at large.

First of all, please allow me to introduce the management team that will be attending today. Chief Financial Officer, Mr. Chieh Ji. Today's press conference will be divided into two parts. First of all, Chief Financial Officer, Mr. Chieh Ji, will lead everyone to understand the business situation of the company in the first quarter of 2026. After that, we will open the question and answer session. Next, let's give the time to CFO, Mr. Chieh.

First, please allow me to introduce a member of our management today joining us. Mr. Xie Ji, our Chief Financial Officer, today's conference will consist of two parts. First, our CFO, Mr. Xie Ji, will provide an overview of the company's performance for the first quarter of 2026. And then, this will be followed by a Q&A session. I will now turn the floor over to our CFO, Mr. Xie.

Good afternoon, investors and funders. Good afternoon, everyone. The China Sea Tourism Office released its financial report for the first quarter of the first quarter of 2026 yesterday afternoon. In the first quarter of 2026, in the face of the complex situation of global geopolitical turmoil and oil prices fluctuating dramatically, the company continues to strengthen its deep water and low-carbon infrastructure capabilities through resource-oriented management, cost-efficiency control and business diversification development. Each and every block is jointly established to establish a good foundation for annual high-level development. The annual income is RMB112.96 billion, which is 4.6% of the total profit, and the total profit is RMB11.6 billion, which is 2.4% of the total profit. Next, I will briefly introduce the three blocks to you. has managed to increase the quality of the system and achieve resource dynamic adjustment as the goal. In the first quarter, the overall business, work plan, and repair arrangement are affected. The current platform has a total of 4766,000 jobs, which is 2.5% lower than the previous one. Due to the increase in overseas overseas projects, the utility rate of the potential platform is also increased by 6.5%. The technical version of the company is not broken. Accelerate the transformation of scientific research and technological products, continue to deepen industrial chain co-innovation, system promotion of original innovation technology, promotion of innovation technology, achievement, industrialization, industrialization, transformation, for the development of high-tech business, continue to move energy. In the first stage, the main line of work of oil and gas technology services and the size of the business will all increase. In the transmission version, in the first stage, the transmission service homework of the company will be 21,521 days in total, which will increase by 900 days, which will increase by 4.4%. The company continues to develop and introduce clean energy for marine energy, search for transmission, and use R&D plus energy-powered battery-powered mode in China first. There is a joint improvement in performance, cutting costs, and operating capacity. The total sales of the carbon-dioxide block remains small compared to the rise in the previous year. The second-in-line collection capacity has increased significantly due to the launch of overseas Southeast Asia projects. The third-in-line collection service is provided by the same-time Argentine project. and the end of the Hainan project, the total amount of work done in the period will be increased. The company will focus on the change of the industry, focus on the layout of the main business, and improve the global natural resources configuration and the development of high-end market. At the same time, continue to accelerate the industrialization, transformation, and industrialization that can be achieved, and accelerate the construction of an ocean energy and natural resources service industrial system that is freely controlled by the whole chain. We look forward to working with customers, employees, partners, and shareholders. Thank you, everyone. This is the business situation of the company's first system. Next, please ask your questions.

Thank you for the introduction. Now we will have a Q&A session. In order to give more investors a chance to ask questions, please don't ask more than two questions. Before asking questions, please tell us your company and name. And please note that we will provide questions and answers in the Q&A session. After you ask a question, please leave some time to ask a question. Hello everyone, please press the new button on the microphone to wait. Press the signal button first.

Thank you, Mr. Jie, for the presentation. We'll now proceed to the Q&A session. To allow more investors the opportunity to participate, please limit yourself to no more than two questions. Before asking your questions, please state your name and company affiliation. Please note that consecutive interpretation will be provided throughout the Q&A session. We kindly ask you to pause after each question to allow time for the interpreter. Now, if you wish to ask a question, please press star 1 on your telephone keypad and wait for your turn. That means that you shall press the star key first, followed by the number 1. Thank you.

Now let's have Mr. Zhao Naidi of Guangda Stock Exchange to ask a question. Please raise your voice. Please ask a question.

Thank you. Thank you, Mr. Wang. Thank you, Mr. Wang. Thank you, Mr. Wang. I am Zhao Naidi of Guangda Stock Exchange. Thank you very much for this opportunity to ask a question. I have two questions here. The first question is, we see that under the strategy of national energy security, Donghai Oil will continue to increase its production, increase its depth of water, and have a business in the complex area of the South China Sea. We see that the company in the first quarter has also made some improvements in the cost-saving efficiency of deep water. We would like to ask you about the cost-saving efficiency of deep water all year round and the guidance of the amount of work. Can you give us a guidance? And then we would like to ask you about the technology of deep water in international oil companies. How is our competitiveness compared to the first question?

So I am Zhao Naiji from Everbright Securities. I have two questions, starting by the first question. As we can observe that with China's national strategy of ensuring national energy security, COSO has been increased production output as well as reserves, in particular with remarkable achievements in the deep water area and South China Sea. We have also seen that you have increased utilization of your sunny stocks. in deep water area in Q1. So the first question concerns, can you give us a guide on the day rate forecast and operational volume of your deep water platform throughout the year? So that's the first part of the first question. And the second part is, how do you see your competitiveness against international oil service giants? Thank you.

And then the second question is, we see the oil price this year, the overall oil price in the first quarter of this year, into the beginning of March, the overall oil price should have been relatively high. And then we also saw that in such a political rush, the oil price of such a high-end background price, the national energy security has become a more important issue. We and many investors expect that the future of the country will continue to increase in the energy security field. We would also like to ask the company's leaders whether the actual workload of our company, as well as the expected workload in the future, including capital development, has already had this feeling, and whether we will be able to achieve the same

And the second question is, we have observed that oil prices have been skyrocketing since the beginning of March and have remained at a high level. In particular, given the high oil prices and given the current geopolitical conflict, China's national energy security becomes all the more important. Me and a lot of other investors all agree that Chinese government will do more in safeguarding its national energy security. So the question is, how do you see the status quo of your operational volume? And do you have any forecasts for your operational volume down the road, as well as the CAPEX forecasts? Do you feel the same as I have just introduced? In particular, how is your order reflecting such a new situation? Thank you.

感谢你的提问。 你这个提, 这个两个关注点呢, 一个是都还是比较偏混乱一些, 另外一个呢, 还是希望能够听到公司未来的一个展望, 偏美来一些。 我尝试着呢, 给你做一下, I will answer the first question first. The overall performance of the first quarter of the company is better than that of the first quarter of the company. Germany is still our overseas, especially Brazil and South Africa. um, um, The price of this execution, this is really some of the price of the price of the price of the price of the price of the price of the price of the price of the price of the price of the price of the price of the price of the price of 我们上游甲方的全面的工作安排 我们也在保持跟他们的一个动态的沟通 希望能够满足他们失误 或者是因为中东地缘政治影响 对我们资源的需求 谢谢

So you have touched upon two questions. One is more concerning than that first item. That is more about our forecast. I'll try to answer both of the questions briefly. So, firstly, on the whole, our deepwater semi-sub platforms have been doing quite well for the first quarter of this year, mostly benefiting from our overseas operations, especially operations in Brazil, south part of Brazil, which have seen obvious, clearly improved operational days because that platform was not became operational until September last year. As for the Chinese business, our semi-sub platforms' operational days or operational volume have maintained relatively stable as new prices become executed, while, to be honest, some of the semi-sub platforms' reprice have increased slightly. This offset the slight decrease of the actual operational days of our , which maintained the overall increase of our drilling platform services. As for the four-year cost, because we are waiting for the four-year cost from our clients, we maintain dynamic conversations with them helping to satisfy their requirements of resources in either against the geopolitical situation in the Middle East or in the new era of the 15th five-year plan period. Thank you.

关于您的第二个问题,我是这么理解的。 首先还是要研判油价上升和中东局势的趋势性发展的一个变化。 Because everyone can see that there are actually more than 110, 120, and even higher supply and demand. Even WTI surpassed Blunt. But it also dropped more than 80 days ago. So this kind of fluctuation, in some ways, it is no longer completely this kind of predictable weakness. We also believe that all the will make their own more sustainable rational judgment. As for China, Zhuhai Oil has always hoped to be able to work hard and become the main source of domestic oil production. As far as I know, the domestic oil production in Yiji Province is currently rising, and it should be It should be a fairly large proportion of domestic increases. We will continue to pay attention to the adjustment of China's sea oil capital spending and its comprehensive plan. The work we do is to fully promote the implementation of natural protection. That's all.

As for the second question, I think that we still need to investigate and analyze how things change regarding the oil prices and regarding the Middle East situation because we have seen spot prices as high as more than 110%. or 120 and even higher. And at one time, WTI was even higher than bronze. However, over the past couple of days, we do see spots went down to about 80 plus. So such volatility has already become something that we can barely make any forecast about. I still believe that the oil and gas suppliers will make sustainable and rational judgments On their part, as for domestic China situation, CNOOC is working to become a leading supplier contributing to oil and gas production increase in China domestic, and we have also seen that their crude output for Q1 increased, and they contributed a large part of the output increase of crude oil coming from China domestic. So again, to align with the first question, we will keep observing CAPEX adjustments and whole year forecast adjustments made by CNOOC, and we will provide resources to provide guarantee to their request. Thank you.

现在有请中银国际的Laura之龙开始提问。

我为您开启声音,请您开始提问,谢谢。 切总你好,有两个小问题想请教一下。 First of all, I see that the wealth of our capital has increased a lot. I believe that there is actually a loss in the stock market. Could you please tell us how big the stock market is and how the stock market will be produced? Thank you very much, Lawrence, from DOCI, Bank of China International.

I also have two questions. The first question is that I've seen that in the first quarter of your finance expenses, there was a large part of exchange losses. So can you walk us through to what extent or how large such losses and why there was such a loss? And secondly, I would like you to walk us through the income and profit performance of the first quarter. Thank you.

Okay, thank you for your question. Let me answer the first question first. Financial expenses. In the first quarter of 2026, The main thing is that the loss of the exchange rate is nearly 3.03 billion. It is about 2.8 billion more than the same period last year. There is a loss. The main reason for this loss is because of this kind of accounting. That is, the balance sheet currency and this this kind of difference in the balance between overseas subsidiaries and foreign subsidiaries. This should not be said to be this kind of difference in the scale of overseas management. Because of this, Okay, thank you very much for asking the question.

Regarding your first question about our finance costs, indeed, in Q1 2026, we have the same exchange losses to the amount of around 300 million. $303 million to be more specific, which is $308 million higher than the same period last year, mainly because of the accounting denomination currency that we used. And so, we have the business ceilings with overseas subsidiaries and the balance contributing to such a number that you have seen. It's not necessarily a result of our increased business scale overseas, however, As we keep dealing with our overseas intermediaries, the balance and the numbers will be always be there. Thank you.

继续回答, 再展开回答一下。 公司已经高度关注, 会对损失或者是会对收益, 对公司这种正常经营业绩的脑洞, 甚至也会 So we are also studying relevant solutions. After the solution is completed, we will take the opportunity to take relevant measures. The effect we hope to achieve is to close as much as possible the external port caused by this kind of fast processing. to the company. Of course, we will have a lot of measures. For example, we will explore how to adjust the capital. For example, we will adjust the capital of non-business units, including some necessary debt transfer measures. We are still researching this.

But to elaborate further on this question, we are very much aware of either exchange profits or losses as a result of the situation that I just introduced and how it affects or even disturbs the operating performance of the company. We are even bothered by that. So we are currently examining and looking at some possible solutions take measures at the right time. We choose the timing to take measures for the purpose of closing any influence on the normal operation of the company as a result of such effects exposure arising from accounting treatment. Measures include but not limited to adjusting the functional currency that we use in bookkeeping. Thank you.

The second question, I will briefly introduce the performance of the company's revenue. It should be said that the main data has been reported to the investors. We think it is better than expected. To be specific, the first one is the capital version. Both domestic and foreign, whether it's income or business profits, or business profitability, can all achieve a rise. The second is our technical version, which is also domestic and foreign. In particular, the revenue of the technology block is also better than expected. The profit and loss rate of the business can achieve up to 18%. It should also be the growth of domestic and foreign technology blocks and profit and loss rates. The global supply and demand remains relatively stable. Please translate.

And then, when it comes to a specific breakdown of our renew and profitability, so on the whole, things are better than expectation in terms of segment breakdown. For our journey service, domestic and overseas revenue, upwards margin, and upwards profit, all three are better compared with the same period last year. In terms of the well services, domestic and overseas, especially overseas, revenue performed better than expectation. Operating profit margin reached around 18%, 180%, and both domestic and overseas well service revenue and profit have increased year on year. As for geophysical and vessel service, both performed stable. Thank you.

我再补充一句, 其实从抄开这个贵队损失以外呢, 其实公司整体的经营力量, 2026年一季度, 实现了15.3个亿, 同比呢是达到了将近22%的一个增幅, 打开国内国外看呢, 国内国外, And to add one more thing about the operating process,

For the first quarter of this year, operating profits of COSO reached 1.53 billion, an increase of 22% year-on-year. Both domestic and overseas have increased by 20% year-on-year, which means that the company's normal operations have been rather good, excluding or aside from whatever impact that we suffer from the exchange losses.

Thank you, Mr. Qiu. Now, let's have Mr. Yan Beinau of Zhongjin Company to ask a question. Please raise your voice.

Please start the question. Thank you. Okay. Mr. Qiu, we are concerned about the change in the project of our J-Cup. And then its restructuring and the development of the solar system. Can you tell us more about it? If this process is over, does it mean that we will have a more obvious improvement in the environment in the second quarter? My second question is still to talk about the situation in the middle of the year. Because we also saw that in March, some of the middle businessmen in the middle of the year, in fact, everyone has some stop-and-go jobs. But from the middle of April, there are some level of repair. For example, like Ball, some of their four platforms have also completely restored their jobs. I have two questions.

The first question is about your jack-up because I've noticed that your jack-up platform's utilization days in Q1 of this year went down a little bit because of some scheduled repair and maintenance scheme. So the question is, after the maintenance and repair complete, do you see their utilization days increase in Q2 compared with this quarter? And my second question is about your business in the Middle East, because we do see some pause in the operation of some contractors in the Middle East in March. However, starting from mid-April, a lot of the contractors have recovered their operations So I wonder how that will impact your Middle East operation. Thank you.

打下你提问,我先回答第一个问题。 关于这个平台的这个问题。 一季度呢,公司的平台的修理天数较同期呢,还是有一个明显的上涨。 这个上涨呢,是在公司的计划范围之内。 Overall, this year's repair plan should be a little more than the previous year. This is going to be a little more. The first stage is mainly focused on domestic self-improvement. But it's basically flat. But the increase in repair costs has also been carried out by the company's high fee, whether it's domestic self-improvement. or domestic half-price, or it is the full release of Norway's tax, and the new increase of the new tax in Brazil, this income, this kind of work, this kind of work, this kind of work, this kind of work, this kind of work, this kind of work, this kind of work, this kind of work,

So, to firstly answer your first question, indeed, in Q1, our jet caps repair days have increased significantly compared with the same period last year. Such repairs has already been planned for by the company. And you will find that throughout the year of this year, there will be more repair days, scheduled repair days of our platforms compared with previous years. And for Q1, mostly set repair are concentrated in our jack-up platforms domestic, and our semi-sub repair have maintained stable. But you will also find that whatever impact the increased repair days of our platform has on our company's revenue has already been offset by the high day rate of China domestic jackups and semisops and the execution of the high day rate in Norway and the increased cost contribution by Brazil. Thank you.

The second question is about the basic situation of the company in the Middle East. It should be said that the war started on February 28th. The company's first level is currently not because of the Middle East. uh, uh, uh, uh, In fact, it is still in a state of work and collection. This company is in some of the mining businesses in the land of Iraq. Indeed, it was affected by the reduction of production in Iraq. Continuously in a stagnant state Please welcome

There is one more thing I want to add for the first question, because there is a part about our retail plan for Q2. Such plan will be very much aligned with the operational plan of our clients. So that's about the first question. As for the second question, the situation in the Middle East, the war occurred or took place in the Middle East on the 20th of 8 February, so in Q1. the situation didn't impact us in a major way. However, we do gradually start to feel such impact starting from mid or late March. Specifically, our jet-top and semi-tops in Saudi Arabia and Kuwait maintain operational and keep charging. However, the land rates in Iraq have been affected by the decreased Output in Iraq and such impact is already being felt. Thank you.

公司应对中东的这个变化 主要也是采取了两个措施 一个呢就是 一个呢就是还是 加大在中东的业务线的布局 In March, we also received a long-term large-scale contract for the technical section. We also continued to add a contract for short-term stock in Iraq. The second one is still based on the advantage of the global employment structure in Europe. We also continued to work in Southeast Asia. Um, um, Then regarding your question about the Middle East changing situation,

We basically will take two measures in response. One is to try to scale up our businesses in the Middle East. Let me give you some examples. We have recently secured a long-term large value contract for our well service in that region, and also we have secured a turnkey or EPC contract contract for our drilling service in Iraq. In addition to that, given our global landscape, leveraging such advantage as a global player, we try to have the opportunities in RBN as well as in America as the EPC contractor. We already see progress in both from the EPC business, we hope, can hopefully offset the impact as a result of Middle East. On the other hand, we keep a close eye on the Middle East situation and make plans so that we are always ready when our clients are ready to resume their operations in that region. Thirdly, we will seek opportunities that as maximum as we can try to replace some of the players

Thank you.

Thank you. M5G Co., Ltd. has signed a cooperation framework agreement. We should be in the East Asia region, which is a relatively new coastal area. I would like to ask Mr. Xie to give us a brief introduction to East Asia, including the oil and gas market situation in Asia, including the oil and gas production in Asia. If you can show us the specific rhythm and scale of the contract landing, that would be better. I would like to ask Mr. Xie to introduce it.

From Boston Security, my question is, I noticed that a couple of days ago, COSO announced a cooperation framework agreement with a player in Kazakhstan because when it comes to the Middle Asia, COSO is a new player, or Middle East, Middle Asia features the new in your global landscape. So can you walk us through the overall market of oil field services in the Middle Asia or specifically in Kazakhstan? And I would appreciate it very much if you can give us more details on when do you expect the cooperation become more of a substantiality? Thank you.

Thank you for your question. This is a question I'm afraid I'll try my best to communicate with you as much as I know. It should be said that China oil and even China oil and gas are actually far from the Asian market. It's been a long time. This time, the re-entry should also be the two sides. This is an ideal choice. A while ago, President Zhao Shengqiang went to Afghanistan in person to sign the framework agreement with them. It should be said that it has increased the global layout of the company to a very promising point.

Thank you for the question. Due to the limitation of my professional knowledge, I can only share with you to the best of my knowledge. For Koso and for Sinuk, Middle Asia or Central Asia has been an area that we have left for a long time. And the re-entry into this place is something of significance. So not long ago, the chair of the board, Mr. Zhao, went personally to Kazakhstan to sign the cooperation framework agreement that you have just mentioned, which will add a very promising point to the global landscape of COSO.

We have also conducted preliminary research on the basic situation of the country. In general, as far as I know, the first is that the current food resources of the country are mainly used for corruption, and it will still be easy to be affected by the extreme cold weather. Therefore, all parties, all business lines are integrated into the next step of opening up work, including ah ah ah ah ah ah We will have specific information to report to you. Please translate.

So we did have conducted some preliminary investigation into the basic oil reserve situation of that country, and we find that mostly the reserves are in the mudflats area and very much prone to extremely cold weather. So the plan will mostly request the effort by our colleagues from the cementing business area, directional drilling, LWD, and their colleagues specializing in other areas to work together. We are currently having discussions on creating operational plans for some tax wells. As more of the details of such plans are coming out, we will be happy to share with all of you more details.

Thank you. Thank you for your answer. I have no other questions.

Now, let's have Mr. Wang Yiming of the US Bank of China to ask a question. Please raise your voice. Please start the question. Thank you.

Thank you for the opportunity to ask me a question.

I actually want to ask about the exchange rate. Because the interest rate should be the transaction difference. And then the transaction difference may be in the stock market. So I want to ask, if our RMB has been in this rise process, will we, for example, use the US dollar to set these contracts? um Thank you. From Bank of America, I have two questions. So, for the first question, I would like to pursue further on the exchange losses because we know that exchange profits or losses, only transactional differences are recorded in your process. As for translational differences, such differences are recorded in your OCI. So, I wonder whether the appreciation of RMB has affected your dollar-denominated contracts already signed. And also, I would like to ask, because you mentioned that your semi-stock platform's day rates have increased, so may I ask whether such increase is observed in domestic China, or is it because you have made adjustments of your day rate because of the RMB appreciation trend that you'd expect will continue down the road And one more part of the question is if R&D keeps appreciating whether change losses will keep being recorded in your profits in the future? And my second question is regarding your well service, can you walk us through a more?

Thank you. In fact, I use specific numbers to calculate with you. Use simple numbers to calculate. Then you can understand. First of all, if the mother company gives overseas money, for example, 100,000 dollars, then the mother company reports. For example, at the beginning of the period, that is, 700,000 yuan is folded into the people. This is reported in the United States. This is 700,000 yuan. If we say a little more extreme, the exchange rate will become 6. Then the company's report of this revenue overseas exchange rate will become 600,000. Then this 100,000 is an exchange rate loss. Then for overseas units, because he is a dollar account, so his It will always show that it is 100,000 dollars. But according to the adjustment of the merger, it is according to the requirement of the merger. Between 100,000 dollars, it can be compared when the merger is reported. But my mother's company came out of these 100,000. It can't be compared. It's because of the financial cost. Please try to translate it because it's too professional.

So to answer the question, let me give you a very simple example using specific numbers so that you understand it more easily. Let's assume that the parent company transmits 100,000 U.S. dollars to its overseas subsidiary. So the 100,000 U.S. dollars is reflected on the balance sheet of the parent company as 700,000 R&D if the exchange rate is 7%. In extreme situation, if the exchange rate goes to six, which means on the balance sheet of the private company, the 700,000 becomes 600,000 and the 100,000 is naturally recorded as exchange loss. For the overseas subsidiary, because the 100,000 RMB is not, 100,000 US dollars does not change because everything is priced in US dollars. In green, balance sheet consolidation, 100,000 US dollars can be balanced out, but the 100,000 RMB as a result of the change loss is recorded as the finance expense. Thank you.

当然毫无疑问, 如果人民币对美元的汇率 一直呈现单边升值的这个趋势, 那么可能确实汇兑损失的 Because of the loss of this exchange rate just now, it will increase. So I just mentioned that we are now going to try our best to put $100,000 in different ways. Let me give you an example. Maybe I got $10,000. Maybe it's affected by this exchange rate fluctuation. It will be relatively small. In the long run, we also looked back at the 14-5 period. The company, in my impression, should be in 2021 and 2022. Or in 2020 and 2023. They each presented a very large exchange rate gain and a very large exchange loss. The impact of the exchange rate during the entire 14-5 period is about 40 million for the company. Sorry, I forgot to give you the question.

So, if, say, RMB keeps appreciating against the U.S. dollar, the exchange loss that you will find on our balance sheet will expand as a result of the example that I just mentioned. So, we are working on taking different measures, trying to narrow the 100,000 USD exposure taking different means, for example, including narrowing it from 100,000 to 10,000 in order to minimize the impact. But if you take a look at a longer time frame, throughout the 14th five-year plan period, in between the two years of 21, 22, there were the one year a major exchange profit and the next year a major exchange loss. But the overall impact on the company's balance sheet throughout the 14-5-year plan period was $44 million. Thank you.

关于你第二个问题呢, 应该说, 也不是第二, 还是第一, 这相当于三个问题。 关于半钱呢, 就是应该说今年 整体的半钱的费率没有明显变化, 但是呢, 一季度, 公司国内有一条 In addition, the use of this ship is very high, reaching nearly 100%. So this is a significant improvement for the entire shipping. Currently, overseas shipping from the company As for the second part of your first question, you have actually raised three questions.

So the second part of your first question regarding the semi-soft, on the whole, the rate of our semi-soft did not change in any major way. However, there was indeed Wang Semi-Sub in domestic China, the day rate has increased significantly in Q1 and its utilization rate reached almost 100%, which greatly contributing to the revenue increase of our Semi-Sub. As for overseas Semi-Sub platforms, because we have assigned long-term fixed rate contracts with the clients, Therefore, there wasn't any major change, thank you.

另外你的另外一个问题呢, 整个公司技术板块一度实现的收入是60.7亿, 从比增长的5%, 主要是受到了海外这种一体化带动的 技术板块的这种快速的增长。 The net profit achieved in the first quarter of the technical version is 11.1 billion, which is 18% of the total growth. It is also a domestic and foreign growth, especially in foreign countries. In terms of profit and loss, the technical version achieved 18.2% of the total growth, which is almost two points of growth. uh uh In the overseas technical version of today's contract, including what I just mentioned, although there is a war in the Middle East, but we have gradually increased the technical version of a high-value long-term contract. We also believe that the technical version, although it may In the future, maybe it will be affected in a short time, but maybe you can also see that we also have four channels in Iraq to carry out full-scale work. It should be said that it is becoming more and more recognized by the market. In order to accelerate our subsequent large-scale entry into the Middle East market, we provide a relatively good foundation. Thank you.

As for the well-serviced business segment, in Q1, the revenue was $6.07 billion, an increase of 5% year-on-year, mainly benefiting from the integration trend of our overseas business, which is growing very fast. In Q1, net margin was the 1.11 billion, an increase of 18% year-on-year. Both domestic and overseas have increased, especially overseas net margin has increased. As for the well-serviced, the margin rate in Q1, the margin rate was 18.2%, an increase of 2 percentage points year-on-year. Domestic, Margin rate exceeded 20%, becoming a main contributor of our profit margin increase in Q1, mainly because last year there were certain one-off factors reducing our margin, and such factors becoming absent this year contributed to the margin increase. Going forward, we will continue to work harder in securing new contracts for our well services. As mentioned, despite the wars in the Middle East, we still manage to secure one high-value long-term contract for cementing service. I believe that for all the impacts that there will be, such impact is only short-term. As you can see, we still have four contracts well-leader drill lock systems operating simultaneously in Iraq, which will help us today in choosing market recognition and help us accelerate our business scale up in Middle East.

Thank you.

In the interest of time, this will be the last investor.

现在有请长江证券的张灵欣老师提问。 你为您开启声音,请您开始提问。 谢谢。 大领导,我正面有一个问题就是, 我想请教一下, 在未来的十五期间公司的一个股东回报方面, 它是不是会未来...

From Changjiang Securities, the question is about your shareholder return plan for the 15th to 5th year plan period. Do you have any plans to increase your dividend payout to the shareholders?

Thank you. I have a question. It should be said that Well, the investor's return is a highly concerned thing about the company's development of all business. Well, from the growth of the company's revenue per share in 2025, you can see that it should be said that it fully reflects the company's size, a turnover of more than 20%. Well, I think that's it. Thank you very much for the question.

Giving back to investors or investor return, it is fair to say, is the purpose and the center of focus of all the business and operational activities of the company. As you can see, the increased EPS is a reflection of the 20% net margin increase of the net profit attributable to the shareholders, which is the attachment to the fact that we respect and give back to shareholders.

公司十四五期间应该说营业收入实现了300、400到500亿的突破。 The current specific plan for 15.5 is still being adjusted. We still hope to continue to achieve this kind of cross-disciplinary growth for the company during 15.5. As for this bonus, it is still hope to be able to fully share the growth of the company with the investors. This is due to the growth of our performance, and it is also due to the fact that we still have sufficient cash flow that can be ensured. We still hope to achieve Thank you.

So throughout the 14th five-year plan period, you notice that our revenue or our turnover increased from 30 billion to 40 billion and to 50 billion, exceeding 50 billion. We are still making plans and adjusting plans for the 15th five-year plan period, but the hope is that in the next five years, our revenue can achieve another milestone increase as we have seen before. As for the dividend payout, we, of course, hope to fully share our growth with shareholders. This is very much dependent on the business growth of the company and strong cash flow situation of the company. And on the whole, the payout ratio, we hope the payout ratio shall be stable with the increase. Thank you.

Okay, thank you for your answer.

Thank you for the questions and thanks to Mr. Chieh and the management team for their detailed insights. We would also like to express our sincere gratitude to everyone for your ongoing interest in and support for COSO due to time constraints. This earnings conference call is now joined to a close. If you have any further questions, please feel free to reach out to our IR department anytime. This concludes our conference call for today. Thank you all and have a nice day.