John Ajay

John Ajay (Occam Crest) inquired about the progression of NESR's ROIA technology, its embedded growth in the $2 billion exit run rate, and its potential to contribute beyond that target.

Answer

CFO Stefan Angeli clarified that the $2 billion exit run rate for 2026 includes only a very limited contribution from ROIA, with significant impact expected from 2027 onwards after extensive testing and commercialization. He noted that ROIA's success could contribute above the current projections.

John Ajay sought clarity on NESR's confidence in achieving the $2 billion exit run rate for 2026, inquiring about the projected growth rates and associated confidence levels for 2027 and 2028. He also asked about the multi-year margin evolution, excluding NEDA projects, and the progression of the ROIA technology, specifically its contribution to the $2 billion run rate and potential for upside.

Answer

CEO Sherif Foda expressed 99% confidence in the $2 billion exit run rate for 2026, citing awarded and signed contracts. For 2027-2028, he projected a solid 10%-15% growth rate, potentially higher with successful tender wins and contributions from "add-on" projects like NEDA (decarbonization arm) and ROIA (rotary steerable MWD/LWD technology), which are not yet fully factored into current plans. CFO Stefan Angeli stated that 2026 margins are expected to be 21%-22% (high 90% confidence), with a goal to improve to 23%-25% in 2027-2028 through efficiencies. Foda added that ROIA's significant contribution is expected from 2027 onwards, with limited impact in 2026 due to extensive testing, and is included in the $2 billion exit rate but not a primary driver for that year.

John Ajay requested quantification of the base case for both overall market growth and NESR's growth in 2025, along with the key assumptions and oil price sensitivities underlying that forecast. He also asked about the potential scale of new organic growth opportunities beyond the base case.

Answer

Chairman and CEO Sherif Foda estimated overall MENA market growth at 3-4% for 2025, while forecasting NESR's growth at a minimum of 8-10%, driven by new contract wins. He stated the base case assumes oil prices in the $60-$70 range and noted that while a significant drop would impact activity, the company's large gas business (~50% of revenue) provides a resilient foundation. The scale of new growth opportunities will be clearer in H2 2025, which will also inform capital return decisions.