Expro Group Holdings N.V. ((XPRO)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Expro Group Holdings N.V.’s recent earnings call painted a picture of mixed sentiments, reflecting both strong performance metrics and looming uncertainties. The company reported impressive first-quarter results and new contract awards, yet acknowledged the challenges posed by market volatility and geopolitical factors. While the long-term outlook remains optimistic, the near-term forecast is tempered by potential project delays and market fluctuations.
Record First Quarter Performance
Expro celebrated a record-breaking first quarter in 2025, achieving $391 million in revenue and an adjusted EBITDA of $76 million, which represents 20% of revenue. This milestone marks the highest first-quarter performance in adjusted EBITDA and margin since the company’s merger with Frank in October 2021.
Strong Contract Awards
The company secured $272 million in new contract awards during the first quarter, spanning regions such as the U.S., Brazil, and Indonesia. These contracts contribute to a robust backlog of approximately $2.2 billion, underscoring Expro’s competitive positioning in the market.
MENA Region Performance
Expro’s operations in the Middle East and North Africa (MENA) region continued to excel, with Q1 revenue reaching $94 million and an impressive EBITDA margin of 37%. This success was driven by increased well intervention integrity revenue in Qatar and higher production solutions revenue in Algeria.
Successful Cost Optimization
Through its Drive 25 efficiency campaign, Expro identified over $30 million in run rate support cost savings. The initiative aims to reduce support costs to around 19% of revenue, reflecting the company’s commitment to operational efficiency.
Positive Long-term Outlook
Despite short-term uncertainties, Expro remains optimistic about the long-term demand for oil and gas. The company anticipates a transition year in 2025, leading to a healthy level of sanctioning activity in 2026 and beyond.
Market Volatility and Tariff Impact
Recent tariff announcements and OPEC+ production increases have introduced significant near-term uncertainty and volatility. These factors could potentially impact Expro’s activity and financial performance.
Challenges in Mexico and Offshore Saudi
Expro foresees contractions in the U.S. land, Mexico, and offshore Saudi markets in 2025, which could affect overall activity levels. The company is preparing to navigate these challenges as they arise.
Potential Delays in Offshore FID Approvals
The approval of offshore projects, particularly in West Africa, may face delays until 2026 or 2027 due to current market conditions and customer caution, impacting Expro’s project timelines.
Flat Revenue Expectation for 2025
Expro expects its 2025 revenue to remain generally flat compared to 2024, attributed to market uncertainties and potential delays in project approvals. The company is bracing for a challenging year ahead.
Forward-looking Guidance
During the earnings call, Expro provided detailed guidance for the upcoming quarters and the full fiscal year. The company anticipates low to mid-single-digit sequential revenue growth and modest EBITDA margin expansion in Q2 2025. Full-year revenue is expected to be flat compared to 2024, with stable or modestly improved margins. Despite macroeconomic uncertainties, Expro’s strategic focus on operational efficiency, cost control, and leveraging its zero net debt balance sheet for financial flexibility positions it well for resilience.
In conclusion, Expro Group Holdings N.V.’s earnings call highlighted a blend of strong performance and cautious optimism. While the company achieved record results and secured significant contracts, it remains vigilant in the face of market volatility and geopolitical challenges. Expro’s strategic initiatives and focus on long-term growth underscore its commitment to navigating the complexities of the current economic landscape.