Superior Drilling Products, Inc. Updates Third Quarter 2022 Expectations and Reaffirms Full Year 2022 Guidance
October 12 2022 - 6:55AM
Business Wire
Full year 2022 guidance unchanged from
previous guidance of revenue in the range of $22 million to $25
million and Adjusted EBITDA of approximately $6 million to $8
million
Superior Drilling Products, Inc. (NYSE American: SDPI) (“SDP” or
the “Company”), a designer and manufacturer of drilling tool
technologies, announced today its updated third quarter 2022
expectations and reaffirmed full year 2022 guidance.
The updated expectations reflect the timing associated with the
initial $3.8 million sale of a Drill-N-Ream® (“DNR”) tool fleet to
Bin Zayed Petroleum for Investment Ltd. The DNR is the Company’s
flagship well bore conditioning tool. As previously announced, Bin
Zayed Petroleum will purchase approximately $13 million of DNRs in
quarterly stages over the next year from the Company, subject to
certain conditions that will be evaluated with each purchase
tranche, and SDP will repair and maintain the purchased tools at an
agreed repair price per tool. The initial tranche, which was
confirmed with the execution of the distribution agreement, is now
planned for the fourth quarter of 2022.
As a result, third quarter 2022 revenue is now expected to be
approximately $4.8 million to $5.2 million and adjusted EBITDA is
now expected to be approximately $1.1 million to $1.4 million
reflecting an adjusted EBITDA margin of approximately 25% at the
mid-point of the range. Full year 2022 revenue and adjusted EBITDA
guidance is unchanged at $22 million to $25 million in revenue and
$6 million to $8 million in adjusted EBITDA. Adjusted EBITDA is a
non-GAAP measure. See the Forward Looking Non-GAAP Financial
Measures discussion in this release.
Troy Meier, Chairman and CEO of Superior Drilling Products,
commented, "We have continued to see strong market conditions in
the Middle East and the U.S. and have modified our third quarter
expectations to reflect the shift in timing of our tool fleet sale
to Bin Zayed from the third quarter to the fourth quarter. As a
result, we are maintaining our full year guidance. We believe there
is significant opportunity for the DNR internationally and look
forward to working with our new international channel partner to
accelerate our exposure throughout the Middle East and North
African regions. Likewise, we continue to gain strength in the U.S.
market as operators are focused on driving productivity and realize
the power of the DNR in their drilling operations.”
SDP expects to release its third quarter fiscal 2022 financial
results in mid-November 2022.
About Superior Drilling Products, Inc. Superior Drilling
Products, Inc. is an innovative, cutting-edge drilling tool
technology company providing cost saving solutions that drive
production efficiencies for the oil and natural gas drilling
industry. The Company designs, manufactures, repairs and sells
drilling tools. SDP drilling solutions include the patented
Drill-N-Ream® wellbore conditioning tool and the patented Strider™
oscillation system technology. In addition, SDP is a manufacturer
and refurbisher of PDC (polycrystalline diamond compact) drill bits
for a leading oil field service company. SDP operates a
state-of-the-art drill tool fabrication facility, where it
manufactures its solutions for the drilling industry, as well as
customers’ custom products. The Company’s strategy for growth is to
leverage its expertise in drill tool technology and innovative,
precision machining in order to broaden its product offerings and
solutions for the oil and gas industry.
Additional information about the Company can be found at:
www.sdpi.com.
Safe Harbor Regarding Forward Looking Statements This
news release contains forward-looking statements and information
that are subject to a number of risks and uncertainties, many of
which are beyond our control. All statements, other than statements
of historical fact included in this release, including, without
limitations, the continued impact of COVID-19 on the business, the
Company’s strategy, future operations, success at developing future
tools, the Company’s effectiveness at executing its business
strategy and plans, financial position, estimated revenue and
losses, projected costs, prospects, plans and objectives of
management, and ability to outperform are forward-looking
statements. The use of words “could,” “believe,” “anticipate,”
“intend,” “estimate,” “expect,” “may,” “continue,” “predict,”
“potential,” “project”, “forecast,” “should” or “plan, and similar
expressions are intended to identify forward-looking statements,
although not all forward -looking statements contain such
identifying words. These statements reflect the beliefs and
expectations of the Company and are subject to risks and
uncertainties that may cause actual results to differ materially.
These risks and uncertainties include, among other factors, the
duration of the COVID-19 pandemic and related impact on the oil and
natural gas industry, the effectiveness of success at expansion in
the Middle East, options available for market channels in North
America, the deferral of the commercialization of the Strider
technology, the success of the Company’s business strategy and
prospects for growth; the market success of the Company’s
specialized tools, effectiveness of its sales efforts, its cash
flow and liquidity; financial projections and actual operating
results; the amount, nature and timing of capital expenditures; the
availability and terms of capital; competition and government
regulations; and general economic conditions. These and other
factors could adversely affect the outcome and financial effects of
the Company’s plans and described herein. The Company undertakes no
obligation to revise or update any forward-looking statements to
reflect events or circumstances after the date hereof.
Forward Looking Non-GAAP Financial Measures
Forward-looking adjusted EBITDA is a non-GAAP measure. The Company
is unable to present a quantitative reconciliation of these
forward-looking non-GAAP financial measures to their most directly
comparable forward-looking GAAP financial measure because such
information is not available, and management cannot reliably
predict the necessary components of such GAAP measures without
unreasonable effort largely because forecasting or predicting our
future operating results is subject to many factors out of our
control or not readily predictable. In addition, the Company
believes that such reconciliations would imply a degree of
precision that would be confusing or misleading to investors. The
unavailable information could have a significant impact on the
Company’s fiscal 2022 and future financial results. This non-GAAP
financial measure is a preliminary estimate and is subject to risks
and uncertainties, including, among others, changes in connection
with purchase accounting, quarter-end and year-end adjustments. Any
variation between the Company’s actual results and preliminary
financial data set forth in this presentation may be material.
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version on businesswire.com: https://www.businesswire.com/news/home/20221012005215/en/
For more information, contact investor relations: Deborah
K. Pawlowski Kei Advisors LLC (716) 843-3908
dpawlowski@keiadvisors.com
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