0001437749-26-014876
SEC filingRevenue fell 3.8% QoQ as Middle East conflict impacted MENA; net loss of $1.0M vs prior profit.
Revenue for Q1 2026 was $367.6M, a decrease of $14.6M or 3.8% sequentially from Q4 2025. The decline was broad-based, with MENA, ESSA, and NLA all reporting lower activity, partially offset by growth in APAC. Net loss was $1.0M compared to net income of $5.8M in the prior quarter, a deterioration of $6.8M. The swing was driven by a $25.5M decrease in Adjusted EBITDA, partially offset by lower severance ($6.7M) and depreciation ($8.4M). Adjusted EBITDA fell to $62.9M (17.1% margin) from $88.4M (23.1% margin), with the margin contraction reflecting both lower revenue and an unfavorable activity mix.
Management expects a balanced 2026 with early-year volatility from Middle East disruptions but resilient deepwater and LNG-related activity. The EIA forecasts Brent to average $96/bbl in 2026, supporting upstream spending. Capital expenditures for the remaining nine months are estimated at $85-$95M. No specific numeric guidance was provided, but the outlook emphasizes energy security and international activity as key drivers for Expro's services.
As of March 31, 2026, Expro held $170.7M in cash and cash equivalents, with restricted cash of $35k. Total debt stood at $79.1M under the revolving credit facility, unchanged from year-end 2025. Shareholders' equity was $1,515.4M, down slightly from $1,534.1M due to net loss and share repurchases. Inventory remained stable at $168.1M, and deferred revenue increased to $21.7M from $17.1M.
The company had $56.8M in contractual commitments for property, plant and equipment as of March 31, 2026, up from $52.0M at year-end 2025. No other material purchase commitments were disclosed. Contingent consideration liabilities of $9.3M are recorded related to acquisitions.
Expro repurchased 1.2M shares for $20.0M during Q1 2026 under a $100M authorization (Oct 2025-Dec 2026), leaving $80M remaining. No dividends were paid. Capital expenditures totaled $25.8M (7.0% of revenue), down from $33.1M in Q1 2025. Debt remained flat with no new issuance or repayment.
Total revenue declined 5.9% YoY to $367.6M, driven by decreases in MENA (-12.7%) and APAC (-13.5%), partially offset by slight growth in ESSA (+1.4%). NLA fell 4.5%. Segment EBITDA fell 15.7% to $88.2M, with ESSA contributing the most ($31.5M). Corporate costs were $28.5M, down from $32.1M. The company also reported $3.2M equity income from joint ventures and $45.4M depreciation and amortization.
Operating cash flow of $25.3M was well below prior year's $41.5M, driven by a net loss of $1.0M versus a profit of $13.9M in Q1 2025. Non-cash addbacks (depreciation, stock comp, deferred taxes, etc.) totaled ~$47.9M, but adverse working capital movements—primarily an $16.7M increase in accounts receivable and a $8.6M income tax outflow—absorbed much of the cash generated from operations. Dividends received from joint ventures provided a $4.7M boost.
Capital expenditure intensity remained high at $25.8M (102% of CFO), essentially consuming all internally generated cash. After funding $20.0M in share repurchases and $4.9M in tax withholdings, the company relied on cash reserves, drawing down cash by $26.7M over the quarter.
Overall, the cash flow profile is strained: operating cash flow barely covers capex and shareholder returns, leaving little room for organic investment or debt reduction. The net loss and working capital outflows are key anomalies that warrant monitoring.