NCSM

Ladies and gentlemen, thank you for standing by. Welcome to the NCS Multistage Q1 2026 results conference call. All participants are at present in a listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. As a reminder, this conference is being recorded. I would now like to hand the call over to Corbin Woodhull of Hayden IR. Corbin, you can begin.

Thank you, Latif. I would like to welcome everyone to the conference call and thank NCS Multistage management for hosting today's call. With us on the call today are Mr. Ryan Hummer, the CEO of NCS Multistage, and Mr. Mike Morrison, the CFO. I would like to remind listeners that some of today's comments include forward-looking statements such as our financial guidance and comments regarding our future expectations for financial results and business operations. These statements are subject to many risks and uncertainties that could cause our actual results to differ materially from any other expectations expressed herein. Please refer to our most recent annual report on Form 10-K and our latest SEC filings for risk factors and cautions regarding forward-looking statements.

Our comments today, as well as the results of operations included in our earnings release, contain the following non-GAAP financial measures: EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA less share-based compensation, adjusted gross profit, adjusted gross margin, free cash flow, free cash flow less distributions to non-controlling interests, and net working capital. These non-GAAP measures and reconciliations to our most comparable GAAP financial measures are provided in our Q1 earnings release, which can be found on our website at www.ncsmultistage.com. With that, I will now turn the call over to Ryan Hummer.

All right. Thank you, Corbin Woodhull, and welcome to our investors, analysts, and employees who are joining our Q1 2026 earnings call. I'll begin by discussing our results for the Q1 and our outlook for the remainder of the year. I'll then briefly review some recent commercial and operational highlights aligned with our strategy and long-term growth objectives. Mike will follow with additional detail on the Q1 and our guidance for the Q2. Revenue for the Q1 of $45.6 million was slightly more than $5 million below the midpoint of our prior guidance. The shortfall was concentrated in Canada with the balance from international.

In Canada, we experienced both challenging weather conditions in March in southern Alberta and Saskatchewan, as well as an earlier than expected onset of spring breakup, which contributed to a year-over-year Q1 Canadian rig count reduction of approximately 7%. Certain of our customers experienced drilling issues or deferred their planned activity from Q1 until later in the year, while other customers reduced activity on recently acquired assets as they evaluate than we had anticipated under a new completions contract that was awarded last year. A high point for the quarter for us was our U.S. revenue, which improved by over 100% year-over-year and by 6% as compared to the fourth quarter of 2025.

Despite the revenue shortfall, we met the midpoint of our adjusted gross margin guidance and reduced our SG&A, even with the inclusion of additional operating expenses related to ResMetrics. As we look forward to the remainder of the year, we're modestly increasing the midpoint of our revenue guidance for full year 2026 and maintaining our adjusted EBITDA guidance despite the challenges encountered late in the Q1. Starting with Canada, our expectations for full year capital spending by our customers remains unchanged. Accordingly, we expect the lower rig count in the Q1 of 2026 compared to the Q1 of 2025 to reverse after spring breakup with modestly higher year-over-year activity in the second half of the year, including jobs that were deferred from Q1 by our customers, as mentioned previously.

Importantly, this view of activity is based on current customer capital budgets and does not reflect any budget or activity adjustments that could result from higher oil prices ensuing from the current conflict in the Middle East. In the U.S., we've had two positive developments that improve our outlook. A large customer has placed an order for a multi-well, multi-basin fracturing systems project in the Permian and the Rockies after a successful initial two-well project last year. We expect to deliver the sliding sleeves for this project later this year, with most of the revenue to come in the fourth quarter. Completions for these wells are expected to take place in 2027. Repeat Precision has successfully converted field trials that were underway during the Q1 into recurring work with several customers. This increase in activity started in late February and has since continued.

Repeat Precision was awarded this work based on the operational performance of our products, validated in many cases by third-party diagnostics resulting from head-to-head comparisons with one or more competing products. Another key differentiator supporting growth at Repeat Precision is the StageSaver frac plug introduced last year. As a reminder, StageSaver is a product that helps customers keep operations running smoothly when unexpected problems happen in the well. It reduces disruptions from screen outs and other downhole issues, which helps customers get more value from their advanced completion methodologies like Simul-frac and Trimul-frac. Additional customer trials are underway for the StageSaver plug and also Repeat Precision's PurpleReign dissolvable plug.

To support recent and potential future growth, we are investing in additional machining assets at Repeat Precision to increase capacity by approximately 25% and to reduce labor costs for overtime hours that we are currently using to support the increased volumes. Our guidance for 2026 currently excludes the potential delivery of sliding sleeves for our first deepwater opportunity in the Gulf of Mexico. We continue to work with our customer and the regulators to advance this opportunity, which could materialize in late 2026 or in early 2027. Our international outlook for this year remains consistent with our prior call. We could see additional orders in the North Sea and higher volumes of frac plug sales to the Middle East, which may be offset slightly by lower tracer diagnostics activity in Saudi Arabia.

Looking forward, we expect continued growth in North Sea activity in 2027 as two of our customers begin multi-year projects in fields that will be utilizing our technology. We've also submitted a tender for a three-well project, which, if awarded, would represent our first shallow water project outside of the North Sea and would continue to validate the applicability of our RayTech frac sleeve family in multiple geographies. I'll now spend just a few minutes reviewing some recent commercial and operational highlights that are aligned with our long-term strategy. During the Q1, a customer in the MidCon region completed the first zipper frac of wells in the U.S. with NCS sleeves. While zipper and Simul-frac completions using NCS sleeves occurs frequently in Canada, this is a great example of a U.S. customer pairing the downhole performance of our fracturing systems technology with efficient surface methods.

This reduces costs and improves financial returns. The customer plans to continue with zipper fracs in this area going forward. We installed several convertible sleeves in a well that the customer intends to use for enhanced oil recovery or EOR in the Permian area. These sleeves can be used during the initial completion and early production phase of the well, with the option to later shift them for controlled injection as part of the overall EOR project. We're developing a 6-inch frac sleeve and service tool to support a customer project in the Rockies for 2027. For this project, our sleeves will be run in several new wells at a depth below an existing well pad and used to re-stimulate the existing asset. Regulatory approval for this application was supported by the unique attributes of our technology and the reliability of our ShiftFrac Close operations.

We've also been awarded a second fracturing systems job in Oman, scheduled for later this year. This follows the successful operations and strong production results from our initial well in the region last year. In tracer diagnostics, we provided our SmartProp solution, initially developed by ResMetrics, to a customer in Canada. This SmartProp tracer carrier has properties that are very similar to frac sand, transporting like sand into the formation to provide a better indicator of stage level performance. Continuing in tracer diagnostics, we recently completed our first RapidTrace project in the North Sea. This on-site testing solution provides qualitative results in nearly real time, eliminating the need to ship samples to our laboratories. The customer validated production from the lateral after the completion during the well-testing phase, informing their decisions and helping them to release expensive dayrate assets from location earlier than they otherwise would have.

Last, the final ResMetrics integration steps are underway. We relocated our manufacturing and laboratory assets from ResMetrics facility in Houston to our facility in Tulsa. Over the next few weeks, we'll move the remaining Houston tracer inventory into our districts, fully consolidating field operations. Our NCS and ResMetrics team has done a fantastic job throughout the integration process. We're starting to benefit from operational synergies, which we expect to accelerate in the second half of the year. Our team in Canada, in particular, is leaning into the new service capabilities and combined offerings to capture revenue synergy potential. Mike will now review our results for the Q1 in more detail and provide our guidance for the Q2 of 2026.

Thanks, Ryan. As reported in yesterday's earnings release, our Q1 revenues were $45.6 million, a 9% decline compared to the Q1 of last year and below our guidance range. The decrease in revenue for the quarter was driven by lower activity in rig counts in Canada, as well as a decline in international service revenue. From a geographic standpoint, the U.S. led with revenue that more than doubled year-over-year, international increased by 13%, and Canada declined by 38%. The increase in the U.S. was broad-based, driven by Repeat Precision product sales and tracer diagnostics service revenue, including a $1.8 million contribution from ResMetrics, a business we acquired in July 2025. International benefited from well construction product sales in the Middle East, delivering a 63% year-over-year increase in international product revenue.

Our adjusted gross profit, defined as total revenue less total cost of sales, excluding depreciation and amortization expense, was $18.2 million for the Q1, representing an adjusted gross margin of 40% compared to adjusted gross margin of 44% for the same period in 2025. Adjusted gross margin was at the midpoint of our guidance. The year-over-year decline reflects a revenue contraction for the quarter attributable to lower activity in Canada and reduced higher margin international tracer diagnostic activity in the Middle East. The favorable contribution for ResMetrics served to partially offset the gross margin pressure. Selling, general, and administrative costs were $15.7 million for the Q1, down 3% compared to the same period last year, reflecting lower incentive bonus accruals recorded in 2026, as well as lower share-based compensation expense associated with our cash settled awards.

ResMetrics contributed $0.7 million of SG&A in the quarter. Normalizing for these items, the rest of our SG&A was lower by $0.4 million year-over-year, further validating our financial discipline. Other income of $1.9 million increased from $0.9 million in the Q1 of 2025, driven primarily by royalty income from licenses associated with our intellectual property, as well as stronger scrap sales. Our net loss for the quarter was $0.4 million, or a loss per share of $0.14, compared to net income of $4.1 million, or diluted earnings per share of $1.51 in the year-ago period.

Adjusted EBITDA was $5.6 million, or an adjusted EBITDA margin of over 12%, short of the low end of our quarterly guidance range and a decline from the $8.2 million in the prior year. Turning to our cash flow and balance sheet. Our cash flow from operating activities was a positive $1.3 million, and our free cash flow was $0.7 million, both improvements to the use of cash from operating activities of $1.6 million and a negative free cash flow of $2.1 million in the same period in 2025. As of March 31st, 2026, we had $34.5 million in cash and total debt of $7.2 million, which consists entirely of finance lease obligations, resulting in a positive net cash position over $27 million.

The borrowing base availability under our undrawn ABL facility was $18.5 million, resulting in total liquidity of $53 million. Turning now to a few points of guidance for the Q2 of 2026. We currently expect Q2 total revenue in the range of $36 million-$39 million, implying an increase of 3% at the midpoint compared to the Q2 of 2025. We expect US revenue from $18 million-$19 million, international revenue from $5 million-$6 million, and Canadian revenue from $13 million-$14 million. Adjusted gross margin is expected to be between 35.5% and 37.5%, with the midpoint of the range representing a modest expansion compared to the Q2 of 2025.

Adjusted EBITDA is expected to be between breakeven and $2 million, and our Q2 depreciation and amortization expense is expected to be approximately $1.6 million. With that, I'll hand it back over to Ryan, who will provide our updated full year 2026 guidance and closing remarks.

Thank you, Mike Morrison. I covered our market expectations, including the various product lines and geographies earlier. Accordingly, our full-year guidance for 2026 is as follows. We currently expect full-year revenue in the range of $186 million-$194 million. This reflects a $2 million increase to the low end of the range and a $1 million increase to the midpoint of our prior guidance. We're maintaining our full-year adjusted EBITDA guidance range at $26 million-$29 million, with the benefit of the higher revenue offset by an expected increase in our cash-settled share-based compensation expense. We're also incurring additional supply chain costs, including shipping and transportation, resulting from the current conflict in the Middle East.

We are increasing our planned capital expenditures for 2026 to $2.2 million-$2.8 million, an increase of $0.8 million at the midpoint. The increased capital investment is dedicated to expanding manufacturing capacity at Repeat Precision in support of growing sales volumes. We expect free cash flow after distributions to our joint venture partner of $11 million-$15 million. This is $1 million lower at the midpoint, reflecting the higher capital expenditures, potential working capital impacts related to revenue timing for the year, and a higher mix of earnings derived from Repeat Precision this year. Consistent with prior years, we anticipate that the achievement of our annual adjusted EBITDA will be weighted to the second half of the year and that our free cash flow will be weighted towards the end of the year.

As I mentioned earlier, our guidance at this time does not incorporate any expectation of increased customer activity that could result from improved customer cash flows associated with higher oil and liquids prices. I believe NCS is very well-positioned if we do enter a market that supports higher oil prices over the medium to long term, both through our presence in North America as a source of shorter cycle production and in international markets where we support highly capital-efficient resource development in growing markets. We've demonstrated our ability to deliver organic revenue growth at high incremental contribution margins, leveraging our relatively fixed SG&A, and expect that we could continue to do so if a new structural demand cycle emerges, as many are suggesting. Before Q&A, I'll close with a few comments. I'm proud of what the team at NCS accomplished during the quarter.

While we fell short on our revenue expectation this quarter, we converted several opportunities that we expect to materialize as revenue later this year and into the future. Our business model continues to be proven as we generated free cash flow during the Q1, a quarter when we've historically experienced a use of cash. We maintain a strong balance sheet and liquidity position with total liquidity of $53 million, including availability under our revolver. We continue to deliver impactful new technology to our customers, as exemplified by our StageSaver composite frac plug and the DualBarrel frac sleeve for enhanced oil recovery. We are approaching the final stages of the ResMetrics operational integration and are on track to realize the expected cost synergies, we're capitalizing on incremental revenue synergy opportunities.

Finally, we're taking actions to better position NCS to capitalize on the growth opportunities that we've been targeting in global offshore markets. We're establishing an internal cross-functional team, including business development, technical services, product line, engineering, and operations, to identify and prioritize commercial and product development opportunities and to assist customers in planning for and delivering successful operations. This team is supported by a recent hire that we've made, bringing on board an individual with extensive global experience in stimulation design and execution, both offshore and onshore, during his time at a super major. We believe that this enhanced focus will better position NCS to capitalize on our strong and growing track record in offshore completions. With that, we welcome any questions.

Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone. To remove yourself from the queue, you may press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Dave Storms of Stonegate. Your line is open, Dave.

Morning. Thank you for taking my questions.

Yeah, absolutely. Thanks, Dave. Good morning.

Morning. Just wanted to start maybe with Canada. You know, obviously there was a lot of things that were maybe headwinds in the quarter for you, between the weather issues, spring break-up, customer delays. Would you be able to maybe break out a little bit more there about how much of a factor each of those variables were? I'm just trying to get a sense for what the risks could be going forward. Obviously, you kept your revenue guide, you know, still very strong, so that's encouraging, but just trying to figure out what the risks are there.

Yeah. I'll take them kind of one by one. Really kind of three, you know, things that kind of cropped up primarily, you know, in March with respect to Canada. The first was the weather that we had alluded to. You know, conditions got unfavorable in March for completions activity in Southern Alberta and Saskatchewan. We had a little bit earlier onset of spring breakup as the thaw line kind of progressed north faster than is typical. You know, I'd say that was probably, you know, half of the driver of, you know, kind of the miss in Canada relative to the Q1 expectations. You know, beyond that, we had some customers who deferred their activity projects they'd expected to kick off in February and March, and they deferred that.

If you think about it, you know, the expectation coming into this year, budgets were set with $60 or $65 oil. There was an expectation that the market would potentially improve in the latter half of the year. It makes sense that some of those customers might defer their planning. With spring breakup hitting in the middle of the year, our Canadian customers have the ability to do that. I think they were just kind of looking at what was in front of them and potential improving market later in the year and just decided to shift their capital a little bit further back. The last piece, which is smaller but is impactful, is we mentioned that customers had some drilling issues.

You know, they either encountered tough formations or weren't able to get to depth, and we don't sell our sleeves until they get installed in the customer's wells. You know, a couple of wells for us where we had expected those sleeves to get installed and either they came up short or, they had to drill a new lateral. The accumulation of all of those led up to, you know, kind of the miss in Q1. I'd say most of that, you know, we'll be able to, you know, recover later in the year. Again, that's on a basis of customers continuing with their initial budgets. I think there's potential upside from there if the markets start to react to, you know, the higher oil price environment.

Understood. That's great commentary. Thank you. Maybe just wanted to talk to some of the new tech. You mentioned that the deep water stuff could either come in 2026 or 2027. Maybe just walk us through some of the variables there. Is this just a matter of getting the tech right? Is there still qualification that needs to be done? Is this a customer timing thing at this point? I guess, what would bring that into 2026 versus 2027? Maybe additionally, what does the backlog for additional projects look like in deep water, assuming this all goes well?

Yeah. So for the initial well, right, the asset has been identified. We're working together with the customer and the regulator, as we've said, for that project. You know, that's being targeted. You know, drilling for that well is expected to start, you know, kind of late this year. We are targeting delivery of sleeves for that project in December. You know, but obviously, with projects like that, there's an opportunity for it to slip a little bit, so we're just being a little bit cautious and not putting a large project into the guidance in December that if it slips by one week or two could fall into next year.

You know, there is ongoing work there, as far as finalizing, you know, the metallurgy that goes into the sleeves and some testing requirements and whatnot, but we do feel like we're on track. Yeah, that customer has identified two other projects in the Gulf of America, where we think that technology would have some application as you move into kinda thinking about later 2027, 2028. As with most projects in the offshore environment, you know, there you have the operator for that well and then other companies who have, you know, smaller percentages of that project. You know, we've been talking to several customers about this deep water solution. We do think that we'll be able to grow that customer base over time.

Again, this is a kinda long cycle from a customer acquisition standpoint, proving out the technology, making sure it's fit for the application in each customer, in each well's environment. We feel good about how that'll play out over the course of the next couple years. We think we're on track for this first well. That customer has plans for additional opportunities, it's from there expanding that customer base and moving into other markets worldwide.

That's great. Thank you. Maybe one more for me before I jump back in queue. On the macro, you guys, you both have a lot of conversations with operators in the industry. Obviously, the macro environment is fast-changing. Are you seeing any operators changing their philosophy or their stance, or is everyone still in a bit of a wait and see mode as the commodity prices change?

Yeah, those conversations are certainly starting to pick up. You know, we're having those conversations, and I think that's been articulated also through some of the drilling contractors have reported recently, whether it be Patterson or Nabors, talking about customer inquiries for increasing the rig count. You've seen some commentary from Halliburton and Liberty and Patterson talking about, you know, the ability to bring some completion crews back into the market. There's not as many excess rigs as there used to be. There's not as much excess frac capacity as there used to be, but those conversations are certainly taking place. And they're taking place both in the U.S. and in Canada. But don't wanna lean into that too much just yet.

We'll wait for the customers to come up with their budgets and actually, you know, contract those rigs and move it from conversations about picking up activity to commitments to do so.

That's great. Thank you for taking my questions. I'll get back in queue.

All right. Thanks, Dave.

Thank you. Our next question comes from the line of John Daniel of Daniel Energy Partners. Please go ahead, John.

Hey, guys. Thanks for all the color on the call. Call it a two-part question for you. You know, let's assume we're positively surprised and the activity accelerations occur a bit faster and more assertively than conventional wisdom. In such a scenario, Ryan, what constraints, if any, do you think could become obstacles to growth, and what could you do right now to start getting ahead of it?

Yeah, John, thanks for the question. For us, really there's very little, right? A lot of that comes from the way we've set up the business model. We are, as I mentioned earlier, we're investing to increase the capacity at Repeat Precision. Those machining assets are coming online in the course of the next month or two, so we'll be able to pick up capacity there, and I think be able to handle growth should it pick up on the frac plug side. If it comes to fruition right across tracer diagnostics, across our frac systems business, from a supply chain standpoint, we're in really good shape across both of those. We've got an outsourced manufacturing model. We're not limited really with respect to any sort of roof line or equipment constraints.

What we'd really need to do is start, you know, hiring some people to support that. In Canada, we use a contractor model, so we have some employees, but we can also flex our field capacity with contractors. It's really good work for them, so if we have activity, I think no issues getting those contractors on board to support it. In the U.S., most of our activities in international is supported by employees. You know, to support a pickup in activity in the U.S. international, we would need to start hiring folks and getting them out there and trained and on jobs. You know, we maintain kind of a roster of folks who either previously worked at NCS or that have come to us in the past as we've had open positions.

We can lean into that.

Okay.

... and try to build up that workforce as quickly as possible. It's really more a people constraint than it is, you know, a manufacturing or supply chain constraint.

Okay. Sticking with the sort of the glass half full outlook here, from my perspective at least, if we have that, you know, you guys went through a number of new projects that you're working on. As you think about the growth in the business, would you expect, you know, the faster growth rate to come from those new projects, products, if you will, or like legacy products? I'm not looking for specific financial guidance here, although it's gonna sound like it.

Mm-hmm.

... speak to what happens in terms of margin impact over you know, multiple quarters if the thing, if we take off here.

It's a good question. I think if the industry does inflect, I think in some ways it leads with kind of our historical products. I'll say there's a little bit of nuance to that in that, you know, for Repeat, StageSaver I think has moved on to where, you know, it was introduced last year, and it's now probably half of the volume on the plug sides. That new product is really kind of at the leading edge in displacing our traditional composite plug.

I think the increase in activity would be across our legacy products and projects, but it could lead to a little bit more rapid, you know, development and advancement of the opportunities across the newer, you know, the newer products and solutions that we've been bringing to market. I think it helps on all fronts, but you react more quickly of what you already know, right? From an operator standpoint, I think it benefits both, but I think it's an uptick, again, kinda traditional products, but does maybe accelerate the timeline to introduce the newer solutions.

Okay. Thank you for including me.

Yep, appreciate it, John.

Thank you. Again, to ask a question, please press star 11 on your telephone. Our next question. Please stand by. Our next question comes from the line of Gowshihan Sriharan of Singular Research. Your line is open, Gowshi.

Good morning, guys. Can you hear me?

We can. Morning, Gowshi.

Good morning. All right. On the calendar, can you the accounts, the top three accounts, the specific customers, have they since reconfirmed the deferred work for H2, or is the Canadian recovery assumptions more of a market-level expectation?

It's a little bit of both, right? Our, you know, I think as we talked about a little bit, we had an M&A combination of two of our larger customers last year that was announced about this time, and that closed, I think it was maybe late in the Q2 last year. When you do have some of that consolidation on the upstream side, a lot of times their pro forma activity will be reduced a bit. We're seeing the year-over-year impacts of that really across more the first and second half, or sorry, first and Q2s of this year. We'd already really kind of experienced the impact in the second half starting last year.

You know, with that customer in particular, they use us in their operating areas where they use frac sleeves, so our fracturing system product line, they also use us for precision products where they run plug and perf completions. We've got a good sense for, you know, as their program moves forward, you know, the projects where they're gonna be using sleeves and the projects where they're gonna be using plugs and how that plays into the revenue for the 2nd half of the year. With respect to the rest of the customer base, yes, again, for our largest customers, you know, our sales and business development team and also our COO have been in front of customers recently kind of confirming their plans for the 2nd half of the year.

It's a bit of a, you know, customer by customer buildup for our larger customers together with a general sense for the market.

Okay. Thanks for that. Just to look at your, the outlook, the H2 out, is that achievable at the current lower rig count levels or is that are you assuming the rig counts in the calendar to level back to Q1 2025 levels?

Right. For Canada, our expectation is unchanged with respect to the market, and that expectation is that the market as a whole, you know, capital spending across our customer base is relatively flat year-over-year, and therefore, rig count would be relatively flat year-over-year across the year. With that, with the rig count having been lower in the Q1 on a year-over-year basis, we do expect rig count will be a little bit higher in the second half on a year-over-year basis. Again, it doesn't include any change in our expectations for what the full-year rig count would be.

Okay. Gotcha. On the Repeat Precision pricing, are the StageSaver and the PurpleReign commanding a premium price over some of your legacy plugs or is this more still of a volume growth story?

For StageSaver, it's primarily volume growth. There's not much of a, you know, pricing differential between the StageSaver and our traditional PurpleSeal composite plugs. You know, the PurpleReign is a different product entirely in that it's a dissolvable frac plug, and that does come at a higher price point in the market, in part because the materials cost that goes into that is a bit more elevated. I'd say just from a kind of profitability standpoint, they command relatively similar contribution margins.

Gotcha. Okay. On a multi-well customer in the U.S. with the sliding sleeves, are you able to give us a size of that project in terms of revenue terms? Is that, is that a low single-digit or double-digit million-dollar opportunity and kind of the margin profile of that opportunity?

Sure. For that one and how it kinda plays into our guidance for the year, I'd say that the expectation is that that could end up being somewhere in the order of 2%-3% of our annual revenue, so think about it as a $4 million-$5 million project. I'm thinking about it that way primarily with respect to, you know, sort of the, call it the standard costs of the sleeves. There is a potential that they would have us provide some additional value-added services related to those sleeves, which would increase revenue but come in at a lower contribution margin.

Gotcha. Okay. On the international side, is the cross-selling between the NCS legacy tracer offering and now the ResMetrics capabilities in the Middle East starting to show up in customer conversations or is that synergy still ahead of us?

Yeah. I think there's definitely still some opportunity ahead, right? The alignment of the sales teams was one of the first things that we did, obviously, in the integration process. You know, the sales teams that came with the ResMetrics acquisition were a little bit less familiar with some of the things that we had that were unique on the NCS side and vice versa. I think as the sales teams get more exposure to being able to offer that full service suite, you know, you are seeing opportunities continue to expand. We talked about a few of them, talked about the SmartProp offering, which was a legacy ResMetrics product, which has some good traction in the market.

Talked about the RapidTrace onsite, which is really more for applications like we talked about in the North Sea or Alaska or maybe even some remote areas in the Middle East, where you want that quick qualitative result and don't want to, don't need to take the time to send a sample back to a lab. The other one that we didn't talk about on this call is something called Luminate, and that's a what we call a composite multi-day sampler. We've had deployments on that. It's been proven to be very robust in the field and have good customer interest to take that out to location on new projects going forward. That was a legacy NCS development that again, sort of that combined sales team is finding opportunities for.

I think we're still relatively early innings in being able to fully capitalize on the full service suite and then to capitalize on the relatively newer product introductions that each of us had coming into the combination.

Yeah, gotcha. All right. I'll make this my last one. On the EBITDA guidance for Q2, you've talked consistently about, you know, relatively fixed SG&A base as a key to operating leverage. Is the Q2 operating compression purely a gross margin issue from a lower revenue mix? At what revenue level does NCS kind of break even? Is that some of the cost due to higher supply chain costs due to what's happening on a macro level?

Right. As far as the EBITDA guidance, then yeah, most of what you're seeing there is with respect to the fixed cost component that exists within cost of sales and the lower gross profit margin that Mike had articulated in Q2, and which we've experienced historically. Obviously, bringing ResMetrics, which is a new, a more U.S.-oriented business in from last year, helps with that. It eliminates some of the seasonality. The pickup in the Repeat Precision business helps to address that a bit. We're always gonna have, so long as, you know, our Canadian business represents the majority of our work or a very large component of our work, you're gonna see some seasonal impacts in Q2.

As far as where does that kind of break even profitability sit, I think, within the guidance, the lower end of the EBITDA range was break even. Call it $35 million of revenue might get you to plus or minus break even at the EBITDA standpoint. You experience the benefits from there as you ramp up. You get a little bit better gross margin percentage flowing through and you're holding those operating costs flat.

Gotcha. Thank you. Thank you, Ryan. Thank you, gentlemen. That's all I had for now.

Thank you.

Thank you. I would now like to turn the conference back to Ryan Hummer for closing remarks. Sir?

All right. Thank you. On behalf of our management team and our board, we'd like to thank everyone for joining the call today, including our shareholders, analysts, and especially our employees. I truly appreciate the depth and breadth of the expertise of our people at NCS, Repeat Precision, and ResMetrics, and the passion and effort that our people bring to their work. Our team continues to provide excellent service to our customers, commercializing new products and services that will enable our customers to be more successful. We're taking on demanding and technically challenging work and delivering results. We appreciate everyone's interest in NCS Multistage, and we look forward to speaking again on our next quarterly earnings call.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Good day, and thank you for standing by. Welcome to the fourth quarter and full year 2025 NCS Multistage Holdings, Inc. earnings conference call. At this time, participants are in a listen-only mode. After the speakers’ presentation, we will open up for questions. To ask a question during the session, you will need to press 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today’s call is being recorded. I would now like to hand it over to your speaker today, Corbin Woodhall, Hayden Investor Relations. Please go ahead.

Thank you, Victor. I would like to welcome everyone to the conference call and thank NCS Multistage Holdings, Inc. management for hosting today’s call. Us on the call today are Mr. Ryan Hummer, CEO of NCS Multistage Holdings, Inc., and Mr. Mike Morrison, the CFO. I want to remind listeners that some of today’s comments include forward-looking statements, such as our financial guidance and comments regarding our future expectations for financial results and business operations. These statements are subject to many risks and uncertainties that could cause our actual results to differ materially from any other expectations expressed herein. Please refer to our most recent Annual Report on Form 10-K and our latest SEC filings for risk factors and cautions regarding forward-looking statements. Our comments today, as well as the results of operations included in our earnings release, contain the following non-GAAP financial measures: EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA less share-based compensation, adjusted gross profit, adjusted gross margin, free cash flow, free cash flow less distributions to noncontrolling interest, net working capital, return on invested capital, net operating profit after tax, and average invested capital. These non-GAAP measures and reconciliations to the most comparable GAAP financial measures are provided in our quarterly earnings release, which can be found on our website at ncsmultistage.com. I will now turn the call over to Ryan Hummer.

Thank you, Corbin, and welcome to our investors, analysts, and employees who are joining our fourth quarter and full year 2025 earnings conference call. I will begin my discussion with the financial highlights for 2025, and I will review certain commercial and operational accomplishments from 2025 and early 2026 that are aligned with NCS Multistage Holdings, Inc.’s vision and core business strategies. I will also discuss the integration of ResMetrics, and outline our strategic objectives for the year. Mike will follow, covering the financial results for the quarter and our near-term guidance. 2025 was a very important and successful year for NCS Multistage Holdings, Inc. Strong performance in the fourth quarter capped a year in which we exceeded the high end of our guidance range for the quarter and full year, for revenue, adjusted EBITDA, and free cash flow. Year over year, we grew revenue by 13% compared to 2024, and 10% excluding the contribution from ResMetrics, which we acquired in July 2025. We achieved revenue growth in each of the U.S., Canada, and international markets despite the challenging industry environment. Adjusted EBITDA increased by 20% year over year, outpacing our revenue growth and reaching $26.7 million with an adjusted EBITDA margin of 15%. Free cash flow, after distributions to noncontrolling interest, totaled $18.9 million and represents over 70% adjusted EBITDA-to-free cash flow conversion, which highlights the impact of our asset-light model. We strengthened our balance sheet while completing the strategic acquisition of ResMetrics, enhancing our global position in the tracer diagnostics space. ResMetrics is a highly complementary addition to our business that I will discuss further. So starting with our strategy, our vision at NCS Multistage Holdings, Inc. is to advance more efficient, intelligent, and sustainable energy development by enabling unmatched well performance. In practice, we deploy this vision in pursuit of the approximately $10 billion global completions market through a cohesive product and service offering that is designed to enable our customers to reliably maximize the value of their unconventional assets. This applies across diverse markets, in the more mature markets in North America, in emerging, high-growth unconventional developments in Argentina and the Middle East, and in more conventional geographies like the North Sea and Alaska, where we are successfully deploying unconventional technologies and techniques, collaborating with our customers to open new markets for our products and services in technically demanding environments, including innovative solutions for heavy oil utilizing steam-assisted gravity drainage, or SAGD, for deepwater offshore markets, and for enhanced geothermal systems. We also continue to partner with our customers to pursue further applications of our products and services during the production phase of the well. As we have discussed before, we have three core strategies that are supported by two guiding principles. I will review each, including recent progress, to demonstrate how we are creating long-term value for our stakeholders. The first core strategy is to build upon our leading market positions. This includes our market share and relationships in Canada, our extensive global track record in fracturing systems, and our expertise in tracer diagnostics, which has been strengthened through our combination with ResMetrics. This strategy is evident when we partner with our customers to introduce our solutions in new markets, often based on our extensive track record and the partnership that we have built with our customers over time. An example includes the first use of our fracturing systems technology for stimulation in a SAGD project in Canada in 2025, which also utilized our tracer diagnostic services to corroborate production results. Another example is the first expected installation of our Raytec Propex sliding sleeve system with integrated screen technology that we expect to deliver to our customer later this year for use in the deepwater Gulf of America. A second core strategy is to capitalize on high-margin growth opportunities worldwide. Over the years, I have highlighted the growth of our customer base in the North Sea, which continues to expand. We have received orders from two new customers already this year, each operating in the Dutch sector of the North Sea. We completed our first well in the Middle East utilizing our fracturing systems technology in 2025 and expect further applications in that market in 2026. And we have made the first sales of Repeat Precision frac plugs in the Middle East in 2025 with continued sales to two customers in the region so far and continuing during 2026. Our final core strategy is to commercialize innovative solutions to complex customer challenges. This proved to be an effective and exciting year for us with several significant achievements. In Canada, we recently installed our first Terrus AICV system, which has an integrated autonomous inflow control valve to improve the production profile of more mature wells, reducing produced water volumes while allowing for potential increases in oil rates. We look forward to additional installations of this system during 2026. Customer adoption of our StageSaver solution at Repeat Precision has been a meaningful contributor to growth, with new customers added during 2025 and early 2026 reflecting the value that our customers place on the contingency mitigation offered by the product, paired with the proven performance of our Purple Seal frac plugs. We are capitalizing on our investments in new tracer diagnostic solutions, including our RapidTrace on-site tracer detection solution, our Luminate multi-day composite samplers, and expanded use of ResMetrics SmartProp particulate tracer into Canada and other geographies. I will now speak to the two guiding principles that underpin our long-term strategy. First, seek to maximize financial flexibility. Our business model reflects this strength, with a net cash position at year end of approximately $29 million and an undrawn revolver. During 2025, we generated $22 million in free cash flow, $19 million of which is free cash flow after distributions to our noncontrolling interest. This free cash flow after distributions constitutes over 70% of our adjusted EBITDA for the year, reflecting meaningful conversion, especially considering our 13% year-over-year revenue growth. Our second guiding principle is to uphold the promise. Our company values are embedded in the promise, which represents the commitments that we make as a company to our employees, customers, vendors, and other stakeholders related to how we conduct business. It also speaks to our focus in the areas of technology, quality, health, safety, and the environment. Now I will provide a brief update on the integration of ResMetrics. This combination immediately strengthened our tracer diagnostics platform, increased our exposure to new markets in the Middle East, and aligned well with NCS Multistage Holdings, Inc.’s culture and our capital-light business model. I am pleased to say that we are operating under the ResMetrics commercial brand in the U.S., having integrated our sales and business development team. We have also upgraded our laboratory information management systems to incorporate certain ResMetrics processes, allowing us to uniformly plan and execute jobs for our customers. Operational and manufacturing integration will soon follow, with manufacturing and U.S. lab operations to be centralized in Tulsa by midyear. We have a clear line of sight to achieve the cost savings that we identified with this transaction, and we are progressing to deliver on revenue synergy opportunities we originally characterized as upside potential from the combination. I will close this section by reviewing our goals for the year, which are straightforward and are aligned with our long-term strategy. In 2026, we aim to grow revenue in excess of underlying market activity in the U.S. and internationally, with an objective to grow total revenue relative to 2025 inclusive of a full-year contribution from ResMetrics. We are targeting the conversion of more than 50% of our adjusted EBITDA to free cash flow. We expect to advance commercial adoption of our recent and new technology introductions, drive further commercial success for our product and service offerings, and also continue to penetrate the newest markets that we have entered. We are working to continuously improve our employee engagement and to ensure workplace safety, and we expect to advance initiatives currently underway to participate in higher temperature and production markets, to drive better data-enabled decision-making, and to expand our gross margin by implementing strategic actions to drive our efficiencies and optimize the cost and performance of our products and services. Mike will now provide more detail for our results for 2025 and our guidance for 2026.

Thank you, Ryan. As reported in yesterday’s earnings release, our fourth quarter revenues were $50.6 million, a 13% increase compared to the fourth quarter of last year, and comfortably above the high end of our guidance range. Growth for the quarter was driven by healthy double-digit percentage improvements in both product and services revenue. From a geographic standpoint, the U.S. led with a 69% year-over-year increase, with international up 5% and Canada down 7%. The increase in the U.S. was due to the improved NCS Multistage Holdings, Inc. fracturing system sales, higher plug revenue from Repeat Precision, and a $2.9 million contribution from ResMetrics, a business we acquired on July 31, 2025. The decline in Canada for the quarter reflected moderately lower activity levels due to a general market headwind. Our fourth quarter revenues were the highest of the year and sequentially increased by 9%, with increases in Canada and the U.S. partially offset by a decline for international. Our adjusted gross profit, defined as total revenues less total cost of sales, excluding depreciation and amortization expense, was $21.2 million in the fourth quarter, representing an adjusted gross margin of 42% compared to an adjusted gross margin of 43% for the same period in 2024. Despite the favorable contribution from ResMetrics, the slight decline in adjusted gross margin was attributable to the mix of international tracer diagnostic jobs and fracturing system service activity, positively offset by an expansion in gross margin for our product sales. Selling, general and administrative costs were $14.2 million for the fourth quarter, down 5% compared to the same period last year, reflecting the timing of incentive bonus accruals recorded in the fourth quarter last year, as well as lower professional fees and share-based compensation expense associated with our cash-settled awards, which we recognize as expense as our stock price changes. During the quarter, ResMetrics contributed $600,000 to our SG&A. The provision for litigation, net of recoveries, was a benefit of $900,000 and resulted from a 2025 ruling by the Federal Court of Appeal of Canada, which remanded a prior judgment against NCS Multistage Holdings, Inc. in a patent dispute to the trial court and reduced the cost award. Accordingly, $900,000 of the cost award was returned to NCS Multistage Holdings, Inc. in November 2025. Other income of $1.1 million declined from $2.4 million for 2024, driven primarily by timing of royalty income licenses associated with our intellectual property, with 2025 activity aligning with our expected normalized rate of approximately $1.0 million per quarter. Net income for the fourth quarter was $15.0 million, or diluted earnings per share of $5.34, which included a positive impact of $9.8 million related to the release of our deferred tax valuation allowance. This reversal demonstrates confidence in our continued profitability and our ability to fully utilize our deferred tax assets in the future. Adjusted EBITDA was $9.2 million, or an adjusted EBITDA margin of over 18%, which exceeds the high end of our quarterly guidance range and is above the $8.2 million for the fourth quarter last year. Now turning to our full year 2025 results. Our revenues were $183.6 million, an improvement of over $21 million, or 13%, compared to 2024, exceeding the 5% midpoint of our initial guidance range for the full year. Excluding the revenue contribution of ResMetrics, which totaled $5.2 million for the five months following the acquisition and was slightly above our expectations, revenue for the year increased by 10%. All regions delivered an increase in total revenue for the year. Our adjusted gross margin for fiscal 2025 was stable at 41%, a slight decline of approximately 40 basis points compared to last year. For 2025, our SG&A expense was $58.8 million, an increase of $1.0 million compared to last year. ResMetrics contributed $1.1 million of SG&A in 2025, while increased share-based compensation expense also drove higher SG&A expenses. However, these increases in SG&A were partially offset by lower professional service fees, R&D expenses, and other SG&A reductions. Other income declined to $4.8 million from $7.3 million in 2024, primarily driven by the timing of royalty income recognition we previously discussed. Also, the prior year benefited from a technical service agreement with our local partner in Oman that ended in November 2024. Net income for 2025 improved to $23.7 million, or diluted earnings per share of $8.65, which includes a net positive impact of $11.5 million related to the release of our U.S. and Canadian deferred tax valuation allowances, as previously discussed. In the prior year, net income was $6.6 million, or diluted earnings per share of $2.55. Adjusted EBITDA was $26.7 million, up 20% compared to $22.3 million in 2024, with an adjusted EBITDA margin expanding to 14.5%, up from 13.7%. Turning to the balance sheet. On December 31, we had $36.7 million in cash and total debt of $7.6 million, which consisted entirely of finance leases, resulting in a net positive cash position of $29.1 million. The borrowing base availability under our undrawn ABL facility was $24.4 million, resulting in total liquidity of approximately $61 million. Turning now to a few points of guidance for the 2026 first quarter. We currently expect first quarter total revenue in the range of $49 million to $53 million, implying an increase of 2% at the midpoint compared to 2025. We expect U.S. revenue to range from $19.5 million to $20.5 million, international revenue from $3 million to $4 million, and Canadian revenue from $26.5 million to $28.5 million. Adjusted gross margin is expected to be between 39% and 41%, a modest decline compared to 2025. Adjusted EBITDA is expected to be between $6.5 million and $8.5 million. Our first quarter depreciation and amortization expense is expected to be approximately $1.6 million. With that, I will hand it back over to Ryan, who will provide our full year 2026 guidance and closing remarks.

Thank you, Mike. We expect the market environment to be challenging again in 2026. Based on our current outlook, we expect flat to lower overall customer activity in North America for 2026 compared to 2025, and for customer activity to increase in the primary international markets that we serve, though the improvements are likely to be weighted towards the back half of the year, especially in the Middle East. Accordingly, our full year guidance for 2026 is as follows: We currently expect full year revenue to range from $184 million to $194 million and for full year adjusted EBITDA to be between $26 million and $29 million. We expect our revenue growth to come primarily from the U.S. and international markets, where we are well positioned to outperform underlying market trends through continued market share gains, particularly at Repeat Precision, and also through new product adoption and continued international expansion. We currently expect Canadian revenue to be lower year over year as we face some headwinds from a lower total rig count, especially in Q1, and from specific customer consolidation that is likely to result in reduced pro forma activity levels. Our financial guidance does not incorporate any meaningful additional impacts from the currently volatile trade environment, including the potential imposition of new or retaliatory tariffs involving the U.S., Canada, and Mexico. The guidance also does not reflect the potential impact of the current conflict in the Middle East, either on operations in the region or potentially resulting from a sustained increase in commodity prices. We expect our gross capital expenditures for 2026 to be between $1.5 million and $2.0 million. In addition, we paid $1.5 million of contingent consideration associated with the ResMetrics acquisition in January 2026, which will be reflected in cash flow from investing activities. We expect our free cash flow after distributions to our JV partner of $12 million to $16 million, further strengthening our robust balance sheet and positioning us to pursue strategic investment opportunities. Due to the seasonality of our business, and consistent with prior years, we would anticipate that the achievement of our annual adjusted EBITDA guidance range will be weighted towards the second half of the year, with free cash flow weighted towards the end of the year. Before Q&A, I will close with a few comments. I am very proud of what the team at NCS Multistage Holdings, Inc. accomplished in 2025. We grew revenue, adjusted EBITDA, and free cash flow in a challenging market environment, delivering the benefits that we expect as we executed our strategic plan. We have the infrastructure in place to support revenue growth. Over time, we would expect our incremental adjusted EBITDA margins to be 25% to 35%. We are benefiting from the successful introduction of new solutions that meet the needs of our customers, adding to our portfolio and expanding our addressable market. We are operating as a unified tracer diagnostics business with ResMetrics. We have completed the work required to realize most of the anticipated synergies of this combination, with more benefit to come as we consolidate our U.S. lab and manufacturing footprint and increasingly focus on revenue synergy opportunities. We maintain a strong balance sheet and liquidity position, with total liquidity, including availability under our revolver, of over $61 million. We are efficiently converting our adjusted EBITDA to free cash flow, with free cash flow after distributions to noncontrolling interest totaling $19 million in 2025, which constituted over 70% of adjusted EBITDA. We expect our free cash flow after distributions to noncontrolling interest to exceed 50% of adjusted EBITDA again for 2026. As of yesterday, the midpoint of our free cash flow guidance for 2026 would represent a free cash flow yield of approximately 132% to our market capitalization. Finally, we uploaded our new investor presentation yesterday, which touches on a few of the items I discussed earlier in the call: our efforts to open new addressable markets, the progress we are making on the areas of emphasis from our corporate strategy, and the actions that we are taking across our product lines to improve profitability. We also added a new slide highlighting our return on invested capital, which illustrates the significant improvement in our business over the past few years. While we continue to be focused on core metrics, including revenue and EBITDA growth, margin improvement, and free cash flow, I think it is important to keep in mind that we are competing for investment capital not only with our industry peers, but the broader market as well, and return on invested capital is an important indicator of a company’s ability to create value for its shareholders over time. I am proud of the progress we have made, achieving after-tax returns of over 11% in 2025, reflecting our disciplined capital allocation and the operating leverage inherent in our business as we grow. Over time, our objective is to continue to improve our returns, with a medium-term objective of 15%, which we believe to be highly competitive across industries. With that, we welcome any questions from the audience.

Press 11 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. Please limit yourself to one question and one follow-up in the interest of time. We will now open for questions. Please stand by while we gather the candidate roster. One moment for our first question. Our first question will come from the line of Dave Storms from Stonegate. Your line is open.

Morning, and thank you for taking my questions.

Morning, Dave.

Just wanted to get started with the puts and takes on guidance. I know there is now a couple of quarters in a row you guys have telegraphed that a lot of your revenues this year are going to be weighted towards the back half. Is there potential for some of that to get moved up, or is a lot of maybe some of the Middle East stuff still in qualification phases that is pretty locked into Q3, Q4?

Yeah, Dave. I think you will see that profile continue. Right? Part of it has to do just with the seasonality of our business and our weighting to the Canadian market where, while Q1 is generally relatively strong, we see spring breakup in the second quarter and then more normalized activity in the second half of the year. Certainly, acquisition of ResMetrics, which is more U.S. and international focused, will help to mitigate that bit, as well as some of the market share gains that we have made with frac plugs in Canada, which tend to go to work that is more year-round. But I think we will continue to see that seasonality. I think as we look to certain specific opportunities, you know, for NCS Multistage Holdings, Inc., they are not just kind of market-driven. We do see a lot of the projects for 2026 developing such that we will see that pattern again with the majority of the earnings and the cash flow coming in the back half of the year.

Understood. That is very helpful. Thank you. And then I know you mentioned in your prepared remarks, you spent a little bit of time talking about some of the cross selling that you have been able to do specifically in Canada. Is it too early to talk about some cross selling potential in the Middle East with the ResMetrics, excuse me, with the ResMetrics transaction, or should we still wait on that until later in the year?

Yeah. So with ResMetrics internationally, we started to see some benefits. It is really more within North America, however. For example, I mentioned a product, a type of particulate tracer that ResMetrics has called SmartProp that was developed and utilized initially with their customers in the U.S., and we have now deployed that and have utilized it with some customers in Canada who really appreciate that technology. We are seeing, and what I would say is, kind of as you look to international markets, we are really looking at the combination of some of the new technologies that we have across that tracer diagnostic platform. One of those that is really applicable internationally is something called RapidTrace, and that is an on-site tracer detection capability for us. And that really brings value in remote markets where it might be hard to collect a sample and ship it to a lab and wait for that time to see results, but also where decisions that you make as you see that tracer result can enable a customer to take an asset off location and save significant dollars. So that is one of the things I think will help us in multiple international markets. The international work that ResMetrics has is really under long-term contracts. We mentioned they have work in the Emirates and in Kuwait. So those contracts, because they are multiyear, can certainly work to expand scope. We can also work to bring some of the best practices we identify across the organization. But as far as kind of revenue cross selling, that will take a little bit more to develop outside of North America.

That is great color. Thank you. I will get back in line.

Thank you. Once again, that is 11 for questions. 11. One moment for any questions to queue up. Alright. One moment for our next question. We have a follow-up from Dave Storms from Stonegate. Your line is open.

Appreciate that. I did also want to ask maybe about what you are seeing in the North Sea. I know it tends to be pretty project by project. Maybe just any updates on the pipeline there as you continue to expand deepwater and some other unique capabilities.

Yeah. Thanks, Dave. Obviously, North Sea has been a great success story for us over the last several years, especially with our fracturing systems technology. I believe last year in 2025, we worked with, I believe it was seven customers across the North Sea, either having sold sleeves or, you know, complete completions work out on the platforms. And I mentioned earlier in the comments that, you know, we have orders in place to add two customers to that roster that are operating in, you know, the Dutch sector of the North Sea. So we are now, you know, working with customers in Norway, in the U.K., in the Netherlands. So, yeah, I think just the breadth of the customer base that we have developed speaks to kind of the product market fit that we have in that region and the results that customers are seeing utilizing that technology. And I think in a prior call, we might have mentioned, you know, a workshop that we held in Norway where we had great, you know, customer engagement and feedback for operators that were operating not just in Norway but across the entire region. So we feel, you know, really, really good about the work that we have in the North Sea. So as far as kind of how that might develop and play forward and, you know, that technology into other markets? You know, one of our North Sea customers is a project partner in the deepwater Gulf of America well that we expect to participate in later this year. So you have some connectivity there. There is also a customer that we have in the North Sea that we are talking to about other project opportunities in shallow water markets outside of the North Sea. So, you know, I would expect that to continue to develop over the course of the next year or two, but we certainly are looking to build on that success in shallow water offshore markets, taking that outside of the North Sea and then leveraging and moving into mid and deeper waters over time as well with our technology.

If I could just ask one follow-up on that. You mentioned the drill that you are expecting later this year in the Gulf of America. It is kind of a new market opportunity for you. How would you characterize maybe in the medium to long term some of your other new market opportunities that you might go after?

Yeah. No. Thanks for the question, Dave. And I think one of the things that came through in the prepared comments is the work that we have been doing to open up new addressable markets for our technology. So certainly, the deepwater is one, and that is a long, you know, a long sales cycle and product development cycle to get to it. So we feel really encouraged to be able to deploy that technology for the first time, hopefully, this year, and we believe that will open up additional opportunities with that customer, but then, you know, also opportunities for other customers that are targeting the same type of reserves going forward. The other areas where, you know, we have, you know, development initiatives in place, one is higher temperature more broadly. That does play into some deepwater markets. It is offshore in traditional oil and gas. It also plays into the thermal oil developments in Canada. I had mentioned SAGD. It also plays into enhanced geothermal systems, where customers are looking to leverage technology developed by the oil and gas industry, horizontal drilling, hydraulic fracturing, to access, you know, the heat in situ, you know, deep underground to provide baseload power that can be used to power data centers and other things. So I think, you know, the SAGD or the heavy oil market in Canada is one that we feel, you know, will open up some opportunities for us over the medium term. I think geothermal is one as well. Those are all relatively early days, will take time to scale, but good examples of what we are looking to do to participate in those markets. The other one is that, you know, historically, we focused primarily on supporting our customers during their completions. And within our fracturing systems portfolio, we do have an enhanced recovery suite of technology. You know, historically, that has been around what we would call injection control, so helping customers be more precise in the way they inject fluid, typically water, but in a waterflood or secondary recovery regime, when they are doing that with a horizontal injector, to being able to compartmentalize the well to create efficient sweeps and optimize the value of those waterfloods. We do have a development underway which is called TERIS AICV. I mentioned that earlier, which is more of a production control solution, which should help our customers to reduce the water cut that they are seeing in their wells, and, you know, handling produced water is an expense for our customers. So the deployment of the solution, we can help them reduce their production operating costs, but then also, through kind of preferentially producing through this specialized valve, preferentially producing the oil relative to the water, you may be able to see an oil production uplift as well. So if we can help our customers both improve their revenue profile and reduce their cost profile on existing assets, that is something that we think will have good application for our customers in the industry over time. And then, again, sort of speaking to one of your earlier questions on the ResMetrics integration and how that plays into some of this enhanced recovery and production space. Historically, we have been a little bit limited in our ability to pursue deploying tracers in waterflood projects. But with some of the new lab and chemical deployment techniques that, you know, we have been able to utilize from that ResMetrics brought to the table, that has opened up new opportunities for us in the production space on the waterflood, and our Canadian team in particular has been very successful this year going out and participating in projects that we probably were not as competitive in before without those capabilities.

That is great color. I really appreciate it. Thank you for taking my questions, and good luck in the quarter.

Alright. Appreciate it. Thanks, Dave.

Thank you. Once again, that is 11 for questions. 11. And I am not showing any further questions in the queue. I would now like to turn it back over to Ryan Hummer, CEO, for closing remarks.

Thank you, Victor. On behalf of our management team and board, we would like to thank everyone on the call today, including our shareholders and analysts, and especially our employees. I truly appreciate the depth and breadth of the expertise of our people at NCS Multistage Holdings, Inc., at Repeat Precision, and the folks that have joined us from ResMetrics, and the passion and the effort that our people bring to their work. Our team continues to provide excellent service to our customers, commercializing new products and services that will enable our customers to be more successful. We are taking on demanding and technically challenging work and delivering results. We appreciate everyone’s interest in NCS Multistage Holdings, Inc. We look forward to speaking again on our next quarterly earnings call.