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What changed in FORUM ENERGY TECHNOLOGIES, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of FORUM ENERGY TECHNOLOGIES, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+216 added−232 removedSource: 10-K (2025-03-03) vs 10-K (2024-03-05)

Top changes in FORUM ENERGY TECHNOLOGIES, INC.'s 2024 10-K

216 paragraphs added · 232 removed · 169 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

47 edited+6 added−12 removed44 unchanged
Biggest changeThe products and solutions consist primarily of: (i) capital and consumable products sold to the pressure pumping market, including hydraulic fracturing pumps, cooling systems, high-pressure flexible hoses and flow iron, as well as wireline cable and pressure control equipment used in the well completion and intervention service markets; and (ii) coiled tubing strings and coiled line pipe and related services.
Biggest changeThe products and solutions consist primarily of (i) capital equipment and consumable products used in the drilling process; (ii) capital equipment and aftermarket products including subsea remotely operated vehicles (“ROVs”) and trenchers, submarine rescue vehicles, specialty components and tooling, and technical services; (iii) capital equipment and consumable products sold to the pressure pumping market, including hydraulic fracturing pumps, cooling systems, and high-pressure flexible hoses and flow iron; (iv) wireline cable and pressure control equipment used in the well completion and intervention service markets; and (v) coiled tubing strings and pressure control equipment used in coiled tubing operations, as well as coiled line pipe and related services. 4 Table of Contents There are several factors that drive demand for our Drilling and Completions segment.
We provide both drilling capital equipment and consumables, with a focus on products that enhance our customers’ handling of tubulars and drilling fluids on the drilling rig.
Drilling. We provide both drilling capital equipment and consumables, with a focus on products that enhance our customers’ handling of tubulars and drilling fluids on the drilling rig.
Our Drilling Technologies product line is influenced by global drilling activity, the level of capital investment in drilling rigs and equipment replacement as drilling contractors modify or replace existing rigs to improve capability, efficiency or safety, and the number of rigs in use, and the severity of operating conditions.
Our Drilling product line is influenced by global drilling activity, the level of capital investment in drilling rigs and equipment replacement as drilling contractors modify or replace existing rigs to improve capability, efficiency or safety, and the number of rigs in use, and the severity of operating conditions.
Of our total employees, approximately 1,100 were in the U.S., 200 were in the United Kingdom, 100 were in Germany, 100 were in Canada and 100 were in other locations. We are not a party to any collective bargaining agreements, other than in our Hamburg, Germany facility.
Of our total employees, approximately 1,100 were in the U.S., 200 were in the United Kingdom, 100 were in Germany, 300 were in Canada and 100 were in other locations. We are not a party to any collective bargaining agreements, other than in our Hamburg, Germany facility.
For sales into certain countries or for select customers, we might require payment upfront or credit support through a letter of credit. For longer term projects, we typically require progress payments as important milestones are reached. On average, we collect our receivables in about 60 days from shipment resulting in a substantial investment in accounts receivable.
For sales into certain countries or for select customers, we might require payment upfront or credit support through a letter of credit. For longer term projects, we typically require progress payments as important milestones are reached. On average, we collect our receivables in about 70 days from shipment resulting in a substantial investment in accounts receivable.
We also manufacture pressure control products that are used for well intervention operations and sold domestically and internationally to oilfield service companies and equipment rental companies. Products we supply include blowout preventers for coiled tubing and wireline units and our Hydraulic Latch Assembly, which is used to facilitate efficient zipper fracturing operations.
We also manufacture pressure control products that are used for well intervention operations and sold domestically and internationally to oilfield service companies and equipment rental companies. Products we supply include blowout preventers for coiled tubing and wireline units, and our Hydraulic Latch Assembly and FASTConnect units, which are used to facilitate efficient zipper fracturing operations.
Failure to comply with these laws or regulations or to obtain or comply with permits may result in the assessment of administrative, civil and criminal penalties, imposition of remedial or corrective action requirements, and the imposition of injunctions to prohibit certain activities or force future compliance.
Failure to comply with these laws or regulations or to obtain or comply with permits may result in the assessment of administrative, civil and criminal penalties, imposition of remedial or corrective action requirements, the imposition of injunctions to prohibit certain activities or force future compliance, and even criminal prosecution.
Our bookings, which consist of written orders or commitments for our products or related services, during the years ended December 31, 2023 and 2022 were approximately $724.3 million and $780.7 million, respectively. Customers No customer represented more than 10% of consolidated revenue in any of the last two years. Seasonality Our business is not significantly impacted by seasonality.
Our bookings, which consist of written orders or commitments for our products or related services, during the years ended December 31, 2024 and 2023 were approximately $780.3 million and $724.3 million, respectively. Customers No customer represented more than 10% of consolidated revenue in any of the last two years. Seasonality Our business is not significantly impacted by seasonality.
Although our patents, trademarks, licenses, trade secrets and know how are material to us in the aggregate, we do not regard any single piece of intellectual property to be material to our business as a whole. 8 Table of Contents Raw materials We acquire component parts, products and raw materials from suppliers, including foundries, forge shops, and original equipment manufacturers.
Although our patents, trademarks, licenses, trade secrets and know how are material to us in the aggregate, we do not regard any single piece of intellectual property to be material to our business as a whole. Raw materials We acquire component parts, products and raw materials from suppliers, including foundries, forge shops, and original equipment manufacturers.
We generally try to purchase raw materials from multiple suppliers so that we are not dependent on any one supplier, but this is not always possible. Working Capital An important consideration for many of our customers in selecting a vendor is timely availability of the product.
We generally try to purchase raw materials from multiple suppliers so that we are not dependent on any one supplier, but this is not always possible. 8 Table of Contents Working Capital An important consideration for many of our customers in selecting a vendor is timely availability of the product.
The market for ROVs can be segmented 5 Table of Contents into three broad classes of vehicles based on size and category of operations: (1) large work-class vehicles and trenchers for construction and installation activities, (2) drilling-class vehicles deployed from and for use around an offshore rig and (3) observation-class vehicles for inspection and light manipulation.
The market for ROVs can be segmented into three broad classes of vehicles based on size and category of operations: (1) large work-class vehicles and trenchers for construction and installation activities, (2) drilling-class vehicles deployed from and for use around an offshore rig and (3) observation-class vehicles for inspection and light manipulation.
Our Cannon Services protectors are used to shield downhole control lines, cables and gauges during installation and to provide protection during production enhancement operations. We design and manufacture a variety of downhole protection solutions for electrical submersible pump (“ESP”) cabling, encapsulated control lines, sub-surface safety valves and permanent downhole gauges.
Our Cannon Services protectors are used to shield downhole control lines, cables and gauges during installation and to provide protection during production enhancement operations. We design and manufacture a variety of downhole protection solutions for electrical 6 Table of Contents submersible pump (“ESP”) cabling, encapsulated control lines, sub-surface safety valves and permanent downhole gauges.
Standard terms with our vendors are 90 days. For critical items sourced from significant vendors, we have settled accounts more quickly, sometimes in exchange for early payment discounts.
Standard terms with our vendors are 60 days. For critical items sourced from significant vendors, we have settled accounts more quickly, sometimes in exchange for early payment discounts.
We also stock raw materials and components in order to be in a position to build products in response to market demand. We typically offer our customers standard payment terms of 30 days, although during downturns in activity, customers often take 65 days or more to settle accounts.
We also stock raw materials and components in order to be in a position to build products in response to market demand. We typically offer our customers standard payment terms of 30 days, although customers often take 65 days or more to settle accounts.
We manufacture a range of consumable products used on drilling rigs, well servicing rigs, and hydraulic fracturing systems. Our consumable products include valves, centrifugal pumps, mud pump fluid end components, including P-Quip™ mud pump modules, Forumlok™, rig sensors, inserts, and dies.
We manufacture a range of consumable products used on drilling rigs and well servicing rigs. Our consumable products include valves, centrifugal pumps, mud pump fluid end components, including P-Quip™ mud pump modules, Forumlok™, rig sensors, inserts, and dies.
The segment’s primary market driver is the level of spending associated with new producing wells as well as spending on midstream and downstream projects. In addition, demand for our Valve Solutions products is affected by activity levels in the power generation, process, petrochemical and mining industries. Production Equipment .
Our Production Equipment product line’s primary market driver is the level of spending associated with new producing wells as well as spending on midstream and downstream projects. In addition, demand for our Valve Solutions products is affected by activity levels in the power generation, process, petrochemical and mining industries. Downhole.
Currently, our insurance program includes coverage for, among other things, general liability, umbrella liability, sudden and accidental pollution, personal property, vehicles, workers’ compensation, and employer’s liability coverage. Employees As of December 31, 2023, we had approximately 1,600 employees.
Currently, our insurance program includes coverage for, among other things, general liability, umbrella liability, sudden and accidental pollution, personal property, vehicles, workers’ compensation, and employer’s liability coverage. Employees As of December 31, 2024, we had approximately 1,800 employees.
We are also a supplier of oilfield bearings, including FracMax™, to original equipment manufacturers and repair businesses for use in drilling and well stimulation equipment. Our primary customers in this product line include domestic and international drilling rig contractors operating land and offshore based drilling rigs. Downhole Technologies.
We are also a supplier of oilfield bearings to original equipment manufacturers and repair businesses for use in drilling and well stimulation equipment. Our primary customers in this product line include domestic and international drilling rig contractors operating land and offshore based drilling rigs. Subsea.
These properties and the substances disposed or released on them may be subject to the CERCLA, RCRA and analogous state laws. Under such laws, we could be required to remove previously disposed substances and wastes, remediate contaminated property, or perform remedial operations to prevent future contamination.
These properties and the substances disposed or released on them may be subject to the CERCLA, RCRA and analogous state laws. Under such laws, we could be required to remove previously disposed substances and wastes, remediate contaminated property, perform remedial operations to prevent future contamination, or to contribute financially to efforts to do the same.
In 2023, over 60% of our revenue was derived from consumable products and activity-based equipment, while the balance was primarily derived from capital products with a small amount from rental and other services. We expect that the world’s long-term energy demand will continue to rise for many decades.
In 2024, approximately 80% of our revenue was derived from consumable products and activity-based equipment, while the balance was primarily derived from capital products with a small amount from rental and other services. We expect that the world’s long-term energy demand will continue to rise for many decades.
Our backlog was approximately $241.6 million at December 31, 2023 and approximately $264.8 million at December 31, 2022. Substantially all of the projects currently in our backlog are subject to change and our customers may seek to terminate these orders.
Our backlog was approximately $213.5 million and $241.6 million at December 31, 2024 and 2023, respectively. Substantially all of the projects currently in our backlog are subject to change and our customers may seek to terminate these orders.
We incorporate by reference the segment and geographic information for the last two years set forth in Note 17 Business Segments , and the information with respect to our acquisition (the “Variperm Acquisition”) of Variperm Holdings Ltd. (“Variperm”) set forth in Note 4 Acquisition .
We incorporate by reference the segment and geographic information for the last two years set forth in Note 17 Business Segments , and the information with respect to the Variperm Acquisition set forth in Note 4 Acquisition .
We are a leading designer and manufacturer of a wide range of ROVs that we supply to the offshore subsea construction, observation and related service markets.
Many of our related technical services complement our vehicle offerings. Subsea vehicles. We are a leading designer and manufacturer of a wide range of ROVs that we supply to the offshore subsea construction, observation and related service markets.
We supply a full portfolio of centralizers, float equipment, stage cementing tools, inflatable packers, flotation collars, cementing plugs and surge reduction equipment. Our products are used globally in the construction of onshore and offshore wells.
We supply a full portfolio of centralizers, float equipment, stage cementing tools, inflatable packers, flotation collars, cementing plugs and surge reduction equipment. Our products are used globally in the construction of onshore and offshore wells. Sand and flow control solutions. Through our Variperm branded tools we provide sand and flow control products for heavy oil applications.
The Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), also known as the Superfund law, imposes joint and several liability, without regard to fault or legality of conduct, on classes of persons who are considered to be responsible for the release of a hazardous substance into the environment.
We are required to manage the transportation, storage and disposal of hazardous and non-hazardous wastes in compliance with the RCRA. 9 Table of Contents The Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), also known as the Superfund law, imposes joint and several liability, without regard to fault or legality of conduct, on classes of persons who are considered to be responsible parties for the release of a hazardous substance into the environment.
Department of Labor and other state, local and international bodies regulating worker rights and labor conditions. In addition, we are subject to certain requirements to contribute to retirement funds or other benefit plans and laws in some jurisdictions in which we operate restrict our ability to dismiss employees.
In addition, we are subject to certain requirements to contribute to retirement funds or other benefit plans and laws in some jurisdictions in which we operate restrict our ability to dismiss employees.
DRILLING AND DOWNHOLE SEGMENT Our Drilling & Downhole segment designs, manufactures and supplies products and solutions to the drilling, artificial lift and subsea markets, including applications in oil and natural gas, renewable energy, defense and communications.
DRILLING AND COMPLETIONS SEGMENT Our Drilling and Completions segment designs, manufactures and supplies products and solutions to the drilling, subsea, coiled tubing, well stimulation and intervention markets, including applications in the oil and natural gas, renewable energy, defense and communications industries.
Frequent refurbishment and recertification of flow equipment is critical to ensuring the reliable and safe operation of a pressure pumping company ’ s fleet. We perform these services and position inventory in strategic locations in North America.
We sell power end assemblies, industrial heat exchanger and cooling systems, manifolds and manifold trailers, high-pressure flexible hoses and flow iron. Frequent refurbishment and recertification of flow equipment is critical to ensuring the reliable and safe operation of a pressure pumping company ’ s fleet. We perform these services and position inventory in strategic locations in North America.
We manufacture Global Tubing® branded coiled tubing strings, including DURACOIL (quench and temper), and coiled line pipe, and provide related services. Coiled tubing strings are consumable components utilized to perform well completion and intervention activities.
We manufacture Global Tubing® branded coiled tubing strings, including DURACOIL (quench and temper), and coiled line pipe, and provide related services. Coiled tubing strings are consumable components utilized to perform well completion and intervention activities. Our coiled line pipe offering serves as an alternative to conventional line pipe and flexible composite alternatives in onshore and offshore applications.
Governmental regulation Our operations are subject to numerous stringent and complex laws and regulations governing the discharge of materials into the environment, health and safety aspects of our operations, or otherwise relating to human health and environmental protection. In addition to environmental and worker safety regulations, we are subject to regulation by numerous other governmental regulatory agencies, including the U.S.
Governmental regulation Our operations are subject to numerous stringent and complex foreign, federal, provincial, state and local laws and regulations governing the discharge of materials into the environment, health and safety aspects of our operations, or otherwise relating to human health and environmental protection.
We have a core focus on the design and manufacture of ROV systems, other specialty subsea vehicles, and rescue submarines, as well as critical components of these vehicles. Many of our related technical services complement our vehicle offerings. Subsea vehicles.
We design and manufacture capital equipment and specialty components used in the subsea sector and provide a broad suite of complementary technical services. We have a core focus on the design and manufacture of ROV systems, other specialty subsea vehicles, and rescue submarines, as well as critical components of these vehicles.
On April 17, 2012, we completed our initial public offering. 7 Table of Contents Backlog As we provide a mix of consumable products, capital goods, and repair parts and services, the majority of orders and commitments included in our backlog as of December 31, 2023 are scheduled to be delivered within six months.
Since then, we have completed acquisitions to round out our offering in certain product lines and to build our Coiled Tubing and Stimulation and Intervention product lines. 7 Table of Contents Backlog As we provide a mix of consumable products, capital goods, and repair parts and services, the majority of orders and commitments included in our backlog as of December 31, 2024 are scheduled to be delivered within six months.
The products and solutions consist primarily of: (i) engineered process systems, production equipment, as well as specialty separation equipment; and (ii) a wide range of industrial valves focused on oil and natural gas as well as power generation, renewable energy and other general industrial applications.
The products and solutions consist primarily of: (i) products designed to safeguard artificial lift equipment and downhole cables; (ii) well construction casing and cementing equipment; (iii) customized downhole technology solutions, providing sand and flow control products for heavy oil applications; (iv) engineered process systems, production equipment, as well as specialty separation equipment; and (v) a wide range of industrial valves focused on oil and natural gas as well as power generation, renewable energy and other general industrial applications.
Under the auspices of the Environmental Protection Agency (“EPA”), the individual states administer some or all of the provisions of the RCRA, sometimes in conjunction with their own, more stringent requirements. We are required to manage the transportation, storage and disposal of hazardous and non-hazardous wastes in compliance with the RCRA.
Hazardous substances and waste The Resource Conservation and Recovery Act (“RCRA”) and comparable state statutes, regulate the generation, transportation, treatment, storage, disposal and cleanup of hazardous and non-hazardous wastes. Under the auspices of the Environmental Protection Agency (“EPA”), individual states administer some or all of the provisions of the RCRA, sometimes in conjunction with their own, more stringent requirements.
The following is a summary of the more significant existing environmental, health and safety laws and regulations to which our business operations are subject and for which compliance may have a material adverse impact on our capital expenditures, results of operations or financial position. 9 Table of Contents Hazardous substances and waste The Resource Conservation and Recovery Act (“RCRA”) and comparable state statutes, regulate the generation, transportation, treatment, storage, disposal and cleanup of hazardous and non-hazardous wastes.
The following is a summary of the more significant existing environmental, health and safety laws and regulations to which our business operations are subject and for which compliance may have a material adverse impact on our capital expenditures, results of operations or financial position.
Demand for our Stimulation & Intervention and Coiled Tubing product lines is impacted by the level of shale or tight sand basin hydraulic fracturing activity and the level of workover and intervention activity. Stimulation and Intervention .
Our Subsea product line is affected by global offshore activity, defense spending, subsea equipment and pipeline installation, repair and maintenance expenditures, and growth in offshore windfarm development. Demand for our Stimulation & Intervention and Coiled Tubing product lines is impacted by the level of shale or tight sand basin hydraulic fracturing activity and the level of workover and intervention activity.
We utilize our international manufacturing partners to produce completed products and components for the majority of our valve products.
We utilize our international manufacturing partners to produce completed products and components for the majority of our valve products. Business history FET was incorporated in 2005 and on April 17, 2012, we completed our initial public offering.
In addition to ROVs, we design and manufacture subsea rescue vehicles capable of a range of tasks, including submarine rescue operations, diver support, seabed survey, port security, under hull search and a variety of other tasks.
In addition to ROVs, we design and manufacture subsea rescue vehicles capable of a range of tasks, including submarine rescue operations, diver support, seabed survey, port security, under hull search and a variety of other tasks. 5 Table of Contents Our subsea vehicle customers are primarily large offshore service companies that serve the oil and natural gas, telecommunications, offshore wind power, and other industries operating in marine environments.
We provide a broad range of high-pressure pumps and flow equipment used by pressure pumping companies during stimulation, intervention (principally plug and perforation activity) and flowback processes. We sell power end assemblies, industrial heat exchanger and cooling systems, manifolds and manifold trailers, high-pressure flexible hoses and flow iron.
We also provide a broad suite of subsea tooling and technical services. Stimulation and Intervention . We provide a broad range of high-pressure pumps and flow equipment used by pressure pumping companies during stimulation, intervention (principally plug and perforation activity) and flowback processes.
Please see “Risk factors—Risks related to our business—We rely on relationships with key suppliers to operate and maintain our business.” Timely receipt of raw materials is critical to our business. In 2022, raw material prices for many of our product lines were negatively impacted by inflationary pressures.
Please see “Risk factors—Risks related to our business—We rely on relationships with key suppliers to operate and maintain our business.” Timely receipt of raw materials is critical to our business and we may not be able to continue purchasing raw materials on a timely basis or at acceptable prices in the future.
We are continuing to develop products to help oil and gas operators lower expenses, increase production, and reduce their emissions while also deploying our technologies in renewable energy applications. Our reporting segments align with business activity drivers and the manner in which management reviews and evaluates operating performance.
We are continuing to develop products to help oil and gas operators lower expenses, increase production, and reduce their emissions while also deploying our technologies in renewable energy applications. In the first quarter 2024, following the acquisition (the “Variperm Acquisition”) of Variperm Holdings Ltd.
Competition The markets in which we operate are highly competitive. We compete with a number of companies of varying sizes. There are several large national and multinational companies that have longer operating histories, greater financial, technical and other resources and greater name recognition. In addition, we have several smaller competitors who compete with us on a regional or local basis.
Competition The markets in which we operate are highly competitive. We compete with a number of companies of varying sizes, including large national and multinational companies, as well as smaller competitors on a regional or local basis. We have no single competitor across all of our product lines.
Our subsea vehicle customers are primarily large offshore service companies that serve the oil and natural gas, telecommunications, offshore wind power, and other industries operating in marine environments. In addition, we sell products to a range of governmental organizations including naval, maritime science and geoscience research organizations. Subsea products and technical services.
In addition, we sell products to a range of governmental organizations including naval, maritime science and geoscience research organizations. Subsea products and technical services. We are also a leading designer and manufacturer of subsea products and components utilized in conjunction with ROVs for the oil and natural gas, renewables, telecommunications and defense markets.
The product line’s primary customers are domestic and international service companies that provide coiled tubing services and oil and gas operators. PRODUCTION SEGMENT Our Production segment designs, manufactures and supplies products and solutions for the production and infrastructure markets.
In addition, our coiled line pipe offering can be utilized to transport carbon dioxide for injection into underground storage. The product line’s primary customers are domestic and international service companies that provide coiled tubing services and oil and gas operators.
We are also a leading designer and manufacturer of subsea products and components utilized in conjunction with ROVs for the oil and natural gas, renewables, telecommunications and defense markets. We manufacture Dynacon ® branded ROV launch and recovery systems, linear cable engines, Sub-Atlantic ® branded ROV thrusters, and a wide range of hydraulic power units and valve packs.
We manufacture Dynacon ® branded ROV launch and recovery systems, linear cable engines, Sub-Atlantic ® branded ROV thrusters, and a wide range of hydraulic power units and valve packs. We design and manufacture these ROV components for incorporation into our own vehicles as well as for sale to other ROV manufacturers.
Our primary customers in this product line are oil and natural gas producers, and service companies providing completions, artificial lift and other intervention services to producers. Subsea Technologies. We design and manufacture capital equipment and specialty components used in the subsea sector and provide a broad suite of complementary technical services.
Our technical team designs unique and well-specific sand control strategies, based on sand characterization, near wellbore conditions, and screen evaluation. Our primary customers in this product line are oil and natural gas producers, and service companies providing completions, artificial lift and other intervention services to producers. Production Equipment .
There are several factors that drive demand for our Drilling & Downhole segment.
There are several factors that drive demand for our Artificial Lift and Downhole segment. Our Downhole product line is impacted by the level of well completion activity and complexity of well construction and completion.
Removed
FET operates in the following three reporting segments: Drilling & Downhole, Completions, and Production. We believe that the reporting segment structure is aligned with the key phases of the well cycle and provides operating efficiencies.
Added
(“Variperm”), we aligned our reportable segments with business activity drivers, our customer base, and the manner in which management reviews and evaluates operating performance. FET now operates in the following two reportable segments: (1) Drilling and Completions and (2) Artificial Lift and Downhole. Refer to Note 17 Business Segments for the product lines making up each segment.
Removed
The products and solutions consist primarily of (i) capital equipment and consumable products used in the drilling process; (ii) products designed to safeguard artificial lift equipment and cables, and well construction casing and cementing equipment; and (iii) subsea remotely operated vehicles (“ROVs”) and trenchers, submarine rescue vehicles, specialty components and tooling, and technical services.
Added
Our historical results of operations were recast retrospectively to reflect these changes in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Removed
Our Downhole Technologies product line is impacted by the level of well completion activity and complexity of well construction and completion. Our Subsea Technologies 4 Table of Contents product line is affected by global offshore activity, defense spending, subsea equipment and pipeline installation, repair and maintenance expenditures, and growth in offshore windfarm development. Drilling Technologies.
Added
ARTIFICIAL LIFT AND DOWNHOLE SEGMENT Our Artificial Lift and Downhole segment designs, manufactures and supplies products and solutions for the artificial lift, well construction, production and infrastructure markets.
Removed
We design and manufacture these ROV components for incorporation into our own vehicles as well as for sale to other ROV manufacturers. We also provide a broad suite of subsea tooling and technical services. COMPLETIONS SEGMENT Our Completions segment designs, manufactures and supplies products and solutions to the coiled tubing, well stimulation and intervention markets.
Added
The Company’s suite of differentiated technology is designed, engineered, and custom-manufactured to meet the stringent requirements of producers. Customers utilize our sand control and near wellbore physics experts who have specific expertise in areas such as physical modelling, experimental testing, petroleum geomechanics, rock mechanics, and geotechnics.
Removed
Our coiled line pipe offering serves as an alternative to 6 Table of Contents conventional line pipe and flexible composite alternatives in onshore and offshore applications. In addition, our coiled line pipe offering can be utilized to transport carbon for injection into underground storage.
Added
Some of our more significant competitors include manufacturing companies such as NOV Inc. and Tenaris S.A., and the manufacturing arms of SLB, TechnipFMC plc and Weatherford International PLC.
Removed
Depending on the product, our valves are manufactured to conform to the standards of one or more of the API, American National Standards Institute, American Bureau of Shipping, and International Organization for Standardization and/or other relevant standards governing the design and manufacture of industrial valves. Business history FET was incorporated in 2005 and formed through a series of acquisitions.
Added
In addition to environmental and worker safety regulations, we are subject to regulation by numerous other governmental regulatory agencies, including the U.S. Department of Labor and other state, local and international bodies regulating worker rights and labor conditions.
Removed
In August 2010, Forum Oilfield Technologies, Inc. was renamed Forum Energy Technologies, Inc., when four other companies were merged into FET.
Removed
These competitors are often times very quick to respond to new or emerging technologies and services, and changes in customer requirements. The principal competitive factors in our markets are product quality and performance, price, breadth of product offering, availability of products and services, performance, distribution capabilities, technical expertise, responsiveness to customer needs, reputation for service and intellectual property rights.
Removed
We believe our products and services in each segment are comparable in price, quality, performance and dependability with our competitors’ offerings. We seek to differentiate ourselves from our competitors by providing a rapid response to the needs of our customers, expert knowledge, a high level of customer service, and innovative product development initiatives.
Removed
Some of our competitors expend greater amounts of money than us on formal research and engineering efforts. We believe, however, that our product development efforts are enhanced by the investment of management time that we make to improve our customer service and to work with our customers on their specific product needs and challenges.
Removed
Although we have no single competitor across all of our product lines, the companies we compete with across the greatest number of our product lines include National Oilwell Varco, Inc., Cameron International Corporation (a subsidiary of Schlumberger), TechnipFMC plc, Tenaris S.A., and Caterpillar, Inc.
Removed
During 2023, inflationary pressures began to improve, but the timing of any further reduction in inflation is unknown, and it is unclear whether we will be able to continue purchasing raw materials on a timely basis or at acceptable prices in the future.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

47 edited+13 added−23 removed212 unchanged
Biggest changeLegal and Regulatory Risks: • Our operations and our customers’ operations are subject to a variety of governmental laws and regulations that affect our and our customers’ costs, prohibit or curtail our customers’ operations in certain areas, limit the demand for our products and services or restrict our operations. • Potential legislation or regulations restricting the use of hydraulic fracturing could reduce demand for our products. • Our financial results could be adversely impacted by changes in regulation of oil and natural gas exploration and development activity in response to significant environmental incidents or climate change actions. • Our operations are subject to environmental and operational safety laws and regulations that may expose us to significant costs and liabilities. • Tariffs imposed by the U.S. government could have a further severe adverse effect on our results of operations. • We are subject to litigation risks that may not be covered by insurance. • The number and cost of our current and future asbestos claims could be substantially higher than we have estimated and the timing of payment of claims could be sooner than we have estimated. • Our products are used in operations that are subject to potential hazards inherent in the oil and natural gas industry and, as a result, we are exposed to potential liabilities that could affect our financial condition and reputation. • Climate change legislation or regulations restricting emissions of greenhouse gases (“GHGs”) and related divestment and other efforts could increase our operating costs or reduce demand for our products.
Biggest changeFurthermore, we may be adversely affected by disputes regarding intellectual property rights. • We may incur liabilities, fines, penalties or additional costs, or we may be unable to sell to certain customers if we do not maintain safe operations. • If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. • The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations. • Facility consolidations or expansions may subject us to risks of operating inefficiencies, construction delays and cost overruns. • Our acquisitions and dispositions may not result in anticipated benefits and may present risks not originally contemplated. • A natural disaster, catastrophe or other event could result in severe property damage, which could curtail our operations. 11 Table of Contents Legal and Regulatory Risks: • Our operations and our customers’ operations are subject to a variety of governmental laws and regulations that affect our and our customers’ costs, prohibit or curtail our customers’ operations in certain areas, limit the demand for our products and services or restrict our operations. • Potential legislation or regulations restricting the use of hydraulic fracturing could reduce demand for our products. • Our financial results could be adversely impacted by changes in regulation of oil and natural gas exploration and development activity in response to significant environmental incidents or climate change actions. • Our operations are subject to environmental and operational safety laws and regulations that may expose us to significant costs and liabilities. • Tariffs imposed by the U.S. government could have a further severe adverse effect on our results of operations. • We are subject to litigation risks that may not be covered by insurance. • The number and cost of our current and future asbestos claims could be substantially higher than we have estimated and the timing of payment of claims could be sooner than we have estimated. • Our products are used in operations that are subject to potential hazards inherent in the oil and natural gas industry and, as a result, we are exposed to potential liabilities that could affect our financial condition and reputation. • Climate change legislation or regulations restricting emissions of greenhouse gases (“GHGs”) and related divestment and other efforts could increase our operating costs or reduce demand for our products.
Furthermore, there can be no assurance that the demand or pricing for oil and 13 Table of Contents natural gas will follow historic patterns, including as a result of increased availability of alternative energy sources.
Furthermore, there can be no assurance that the demand or pricing for oil and natural gas will follow historic 13 Table of Contents patterns, including as a result of increased availability of alternative energy sources.
These transactions also involve risks, and we cannot ensure that: • any acquisitions we attempt will be completed on the terms announced, or at all; • any acquisitions would result in an increase in income or provide an adequate return of capital or other anticipated benefits; 19 Table of Contents • any acquisitions would be successfully integrated into our operations and internal controls; • the due diligence conducted prior to an acquisition would uncover situations that could result in financial or legal exposure, including under the FCPA, or that we will appropriately quantify the exposure from known risks; • any disposition would not result in decreased earnings, revenue, or cash flow; • use of cash for acquisitions would not adversely affect our cash available for capital expenditures and other uses; or • any dispositions, investments, or acquisitions, including integration efforts, would not divert management resources.
These transactions also involve risks, and we cannot ensure that: • any acquisitions we attempt will be completed on the terms announced, or at all; • any acquisitions would result in an increase in income or provide an adequate return of capital or other anticipated benefits; • any acquisitions would be successfully integrated into our operations and internal controls; • the due diligence conducted prior to an acquisition would uncover situations that could result in financial or legal exposure, including under the FCPA, or that we will appropriately quantify the exposure from known risks; • any disposition would not result in decreased earnings, revenue, or cash flow; 19 Table of Contents • use of cash for acquisitions would not adversely affect our cash available for capital expenditures and other uses; or • any dispositions, investments, or acquisitions, including integration efforts, would not divert management resources.
Such factors include: • domestic and foreign supply of and demand for oil and natural gas; • prices, and expectations about future prices, of oil and natural gas; • ability or willingness of the Organization of Petroleum Exporting Countries (“OPEC”) and other major producers to set and maintain production limits; • cost of exploring for, developing, producing and delivering oil and natural gas; • levels of drilling and completions activity; • expected decline in rates of current and future production, or faster than anticipated declines in production; • discovery rates of new oil and natural gas reserves; • the occurrence or threat of epidemic or pandemic diseases and any government response to such occurrence or threat; • ability of our customers to access new markets or areas of production or to continue to access current markets, including as a result of trade restrictions; • weather conditions, including hurricanes and tornadoes, that can affect oil and natural gas operations; • natural disasters, catastrophes or other events resulting in severe property damage; • governmental regulations, including those instituted in connection with a response to climate change; • prohibitions, moratoriums or similar limitations on drilling or hydraulic fracturing activity resulting in a cessation or disruption of operations; • domestic and worldwide economic and political conditions, including inflationary pressures, further increases in interest rates and the cost of capital, a general economic slowdown or recession, political tensions and war (including future developments in the ongoing Russia-Ukraine conflict); • financial stability of our customers and other industry participants; • political instability in oil and natural gas producing countries; • increased pressures to invest in sustainable energy sources, shareholder activism or activities by non-governmental organizations to restrict the exploration, development and production of oil and natural gas; • investors reducing, or ceasing to provide, funding to the oil and natural gas industry in response to initiatives to limit climate change; • conservation measures and technological advances affecting energy consumption; • price and availability of alternative energy resources and fuels; • uncertainty in capital and commodities markets, and the ability of oil and natural gas companies to raise equity capital and debt financing; and • merger and divestiture activity among oil and natural gas producers, drilling contractors and oilfield service companies.
Such factors include: • domestic and foreign supply of and demand for oil and natural gas; • prices, and expectations about future prices, of oil and natural gas; • ability or willingness of the Organization of Petroleum Exporting Countries and other allied producing countries (“OPEC+”) and other major producers to set and maintain production limits; • cost of exploring for, developing, producing and delivering oil and natural gas; • levels of drilling and completions activity; • expected decline in rates of current and future production, or faster than anticipated declines in production; • discovery rates of new oil and natural gas reserves; • the occurrence or threat of epidemic or pandemic diseases and any government response to such occurrence or threat; • ability of our customers to access new markets or areas of production or to continue to access current markets, including as a result of trade restrictions; • weather conditions, including hurricanes and tornadoes, that can affect oil and natural gas operations; • natural disasters, catastrophes or other events resulting in severe property damage; • governmental regulations, including those instituted in connection with a response to climate change; • prohibitions, moratoriums or similar limitations on drilling or hydraulic fracturing activity resulting in a cessation or disruption of operations; • domestic and worldwide economic and political conditions, including inflationary pressures, further increases in interest rates and the cost of capital, a general economic slowdown or recession, political tensions and war (including future developments in the ongoing Russia-Ukraine conflict); • financial stability of our customers and other industry participants; • political instability in oil and natural gas producing countries; • increased pressures to invest in sustainable energy sources, shareholder activism or activities by non-governmental organizations to restrict the exploration, development and production of oil and natural gas; • investors reducing, or ceasing to provide, funding to the oil and natural gas industry in response to initiatives to limit climate change; • conservation measures and technological advances affecting energy consumption; • price and availability of alternative energy resources and fuels; • uncertainty in capital and commodities markets, and the ability of oil and natural gas companies to raise equity capital and debt financing; and • merger and divestiture activity among oil and natural gas producers, drilling contractors and oilfield service companies.
Our debt agreements contain, and any future indebtedness we incur may contain, a number of restrictive covenants that will impose significant operating and financial restrictions on us, including restrictions on our ability to, among other things: • pay dividends on, purchase or redeem our common stock; • make certain investments; • incur or guarantee additional indebtedness or issue certain types of equity securities; • create certain liens; • sell assets, including equity interests in our restricted subsidiaries; • redeem or prepay subordinated debt or debt that is unsecured or secured on a basis junior to our notes; • restrict dividends or other payments of our restricted subsidiaries; • consolidate, merge or transfer all or substantially all of our assets; • engage in transactions with affiliates; • create unrestricted subsidiaries; or 27 Table of Contents • execute our acquisition strategy.
Our debt agreements contain, and any future indebtedness we incur may contain, a number of restrictive covenants that will impose significant operating and financial restrictions on us, including restrictions on our ability to, among other things: • pay dividends on, purchase or redeem our common stock; • make certain investments; • incur or guarantee additional indebtedness or issue certain types of equity securities; • create certain liens; • sell assets, including equity interests in our restricted subsidiaries; • redeem or prepay subordinated debt or debt that is unsecured or secured on a basis junior to our notes; • restrict dividends or other payments of our restricted subsidiaries; • consolidate, merge or transfer all or substantially all of our assets; • engage in transactions with affiliates; • create unrestricted subsidiaries; or • execute our acquisition strategy.
As of December 31, 2023, our subsidiary has a net liability of $0.3 million for the estimated indemnity cost associated with the resolution of its current open claims and future claims anticipated to be filed during the next five years.
As of December 31, 2024, our subsidiary has a net liability of $0.3 million for the estimated indemnity cost associated with the resolution of its current open claims and future claims anticipated to be filed during the next five years.
If we are unable to maintain effective internal controls and, as a result, fail to provide reliable financial reports and effectively prevent fraud, our reputation and operating results would be harmed. The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations.
If we are unable to maintain effective internal controls and, as a result, fail to provide reliable financial reports and effectively prevent fraud, our reputation and operating results would be harmed. 18 Table of Contents The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations.
If our products or services fail to meet specifications or are involved in accidents or failures, we could face 24 Table of Contents warranty, contract or other litigation claims, which could expose us to substantial liability for personal injury, wrongful death, property damage, loss of oil and natural gas production, and pollution or other environmental damages.
If our products or services fail to meet specifications or are involved in accidents or failures, we could face warranty, contract or other litigation claims, which could expose us to substantial liability for personal injury, wrongful death, property damage, loss of oil and natural gas production, and pollution or other environmental damages.
Risks Related to our Common Stock, Indebtedness and Financial Condition: • Our common stock price has been volatile, and we expect it to continue to remain volatile in the future. • Our debt agreements contain operating and financial restrictions that restrict our business and financing activities. • Our variable rate indebtedness may subject us to interest rate risk, which could cause our debt service obligations to increase significantly. • Our ability to access the capital and credit markets to raise capital on favorable terms is limited by our debt level, industry conditions and credit rating. • Provisions in our organizational documents and under Delaware law could delay or prevent a change in control of our company, which could adversely affect the price of our common stock. • We have incurred impairment charges and we may incur additional impairment charges in the future. 12 Table of Contents Risks Related to our Business and Operations: The success of our business largely depends on activity levels in the oil and natural gas industry, which can be affected by the amount and volatility of oil and natural gas prices.
Risks Related to our Common Stock, Indebtedness and Financial Condition: • Our common stock price has been volatile, and we expect it to continue to remain volatile in the future. • Our debt agreements contain operating and financial restrictions that restrict our business and financing activities. • Our variable rate indebtedness may subject us to interest rate risk, which could cause our debt service obligations to increase significantly. • Our ability to access the capital and credit markets to raise capital on favorable terms is limited by our debt level, industry conditions and credit rating. • Provisions in our organizational documents and under Delaware law could delay or prevent a change in control of our company, which could adversely affect the price of our common stock. • During the year ended December 31, 2024, we incurred impairment charges and we may incur additional impairment charges in the future. 12 Table of Contents Risks Related to our Business and Operations: The success of our business largely depends on activity levels in the oil and natural gas industry, which can be affected by the amount and volatility of oil and natural gas prices.
As a result of this concentration in part of our supply chain, our business and operations may be negatively affected if our key suppliers were to experience significant disruptions affecting the price, quality, availability or timely delivery of their products, or if they were to decide to terminate their relationships with us.
As a result of this concentration in part of our supply chain, our business and operations may be negatively affected if our key suppliers were to experience significant disruptions affecting the price, quality, 15 Table of Contents availability or timely delivery of their products, or if they were to decide to terminate their relationships with us.
District Court of the Western District of Louisiana issued a permanent injunction against the pause of oil and natural gas leasing on public lands or in offshore waters of the thirteen plaintiff states that brought the lawsuit, which followed a June 2021 nationwide preliminary injunction by the district court that was subsequently vacated by the U.S.
District Court of the Western District of Louisiana issued a permanent injunction against the pause of oil and natural gas leasing on public lands or in offshore waters of the thirteen plaintiff states that brought the lawsuit, which followed a June 2021 nationwide 21 Table of Contents preliminary injunction by the district court that was subsequently vacated by the U.S.
These provisions include: • a classified board of directors, so that only approximately one-third of our directors are elected each year; 28 Table of Contents • authority of our board to fill vacancies and determine its size; • the ability of our board of directors to issue preferred stock without stockholder approval; • limitations on the removal of directors; and • limitations on the ability of our stockholders to call special meetings.
These provisions include: • a classified board of directors, so that only approximately one-third of our directors are elected each year; • authority of our board to fill vacancies and determine its size; • the ability of our board of directors to issue preferred stock without stockholder approval; • limitations on the removal of directors; and • limitations on the ability of our stockholders to call special meetings.
In the ordinary course of business, we become the subject of claims, lawsuits and administrative proceedings seeking damages or other remedies concerning our commercial operations, products, employees and other matters, including occasional claims by individuals alleging exposure to hazardous materials as a result of our products or operations.
In the ordinary course of business, we become the subject of claims, lawsuits and administrative proceedings seeking damages or other remedies concerning our commercial operations, products, employees and other matters, including occasional claims by individuals alleging exposure to hazardous materials as a result of our 22 Table of Contents products or operations.
Our business and our customers’ businesses may be significantly affected by: • federal, state and local U.S. and non-U.S. laws and other regulations relating to oilfield operations, worker safety and protection of the environment; 21 Table of Contents • changes in these laws and regulations; • the level of enforcement of these laws and regulations; and • interpretation of existing laws and regulations.
Our business and our customers’ businesses may be significantly affected by: • federal, state and local U.S. and non-U.S. laws and other regulations relating to oilfield operations, worker safety and protection of the environment; • changes in these laws and regulations; • the level of enforcement of these laws and regulations; and • interpretation of existing laws and regulations.
If we fail to comply with any applicable law or regulation, our business, results of operations or financial condition may be adversely affected. Potential legislation or regulations restricting the use of hydraulic fracturing could reduce demand for our products.
If we fail to comply with any applicable law or regulation, our business, results of operations or financial condition may be adversely affected. 20 Table of Contents Potential legislation or regulations restricting the use of hydraulic fracturing could reduce demand for our products.
In addition, some of our competitors are large national and multinational companies that we believe are able to devote greater financial, technical, manufacturing and marketing resources to research and develop more or better systems, services and technologies than we are able to do.
In addition, some of our competitors are large national 17 Table of Contents and multinational companies that we believe are able to devote greater financial, technical, manufacturing and marketing resources to research and develop more or better systems, services and technologies than we are able to do.
Actual or alleged violations could damage our reputation, be expensive to defend, impair our ability to do business, and cause us to incur civil and criminal fines, penalties and sanctions. Compliance with regulations relating to export controls, trade sanctions and embargoes administered by the countries in which we operate, including the U.S.
Actual or alleged violations could damage our reputation, be expensive to defend, impair our ability to do business, and cause us to incur civil and criminal fines, penalties and sanctions. 25 Table of Contents Compliance with regulations relating to export controls, trade sanctions and embargoes administered by the countries in which we operate, including the U.S.
Court of Appeals for the District of Columbia struck down the ACE rule but did not reinstate the former CPP regulation. In June 2022, the CPP was struck down by the United States Supreme Court, which held that Congress did not grant EPA the authority to devise emissions caps based on the generation-shifting approach the EPA took in the CPP.
Court of Appeals for the District of Columbia struck down the ACE rule but did not reinstate the former CPP regulation. In June 2022, the CPP was struck down by the U.S. Supreme Court, which held that Congress did not grant EPA the authority to devise emissions caps based on the generation-shifting approach the EPA took in the CPP.
In 2019, the U.S. government entered into tariff agreements with Mexico and Canada to remove Section 232 tariffs, and, in 2021 and 2022, the U.S. government entered into tariff agreements with the European Union, Japan, and the United Kingdom to ease Section 232 tariffs on the close allies and trade partners, but Section 232 tariffs still remain in effect with 23 Table of Contents respect to the other nations.
In 2019, the U.S. government entered into tariff agreements with Mexico and Canada to remove Section 232 tariffs, and, in 2021 and 2022, the U.S. government entered into tariff agreements with the European Union, Japan, and the United Kingdom to ease Section 232 tariffs on the close allies and trade partners, but Section 232 tariffs still remain in effect with respect to the other nations.
This litigation is ongoing and future implementation of the BLM rules is uncertain at this time. In past sessions, Congress has considered, but not passed, the adoption of legislation to provide for federal regulation of hydraulic fracturing under the SDWA and to require disclosure of the chemicals used in the hydraulic fracturing process.
These challenges remain ongoing and future implementation of the BLM rules is uncertain at this time. In past sessions, Congress has considered, but not passed, the adoption of legislation to provide for federal regulation of hydraulic fracturing under the SDWA and to require disclosure of the chemicals used in the hydraulic fracturing process.
Our ability to borrow under the Credit Facility and comply with some of the covenants, ratios or tests contained in our debt agreements may be affected by events beyond our control.
Our ability to borrow under the Credit Facility and comply with some of the covenants, ratios or tests contained in our debt 26 Table of Contents agreements may be affected by events beyond our control.
Under the new law, the state oil and natural gas agency must review well locations for environmental protection criteria. In addition, the legislation broadened the authority for local governments to further regulate or restrict hydraulic fracturing. In April 2021, the California Governor’s Office directed state regulators to end the issuance of new permits for hydraulic fracturing by January 2024.
Under the new law, the state oil and natural gas agency must review well locations for environmental protection criteria. In addition, the legislation broadened the authority for local governments to further regulate or restrict hydraulic fracturing. In April 2021, the California Governor’s Office directed state regulators to end the issuance of new permits for hydraulic fracturing, rules effective October 2024.
The identification of a 18 Table of Contents material weakness in the future could also cause investors to lose confidence in the reliability of our financial statements and could result in a decrease in the value of our common stock.
The identification of a material weakness in the future could also cause investors to lose confidence in the reliability of our financial statements and could result in a decrease in the value of our common stock.
Our success depends on our ability to develop and implement new product designs and improvements that meet our customers’ needs in a manner equal to or more effective than those offered by our competitors.
Our success depends on our ability to implement new technologies and services more efficiently and quickly than our competitors. Our success depends on our ability to develop and implement new product designs and improvements that meet our customers’ needs in a manner equal to or more effective than those offered by our competitors.
We may also be held 26 Table of Contents responsible for violations by an acquired company that occur prior to an acquisition, or subsequent to an acquisition but before we are able to institute our compliance procedures.
We may also be held responsible for violations by an acquired company that occur prior to an acquisition, or subsequent to an acquisition but before we are able to institute our compliance procedures.
If new or more stringent federal, state or local legal restrictions relating to the hydraulic fracturing process are adopted in areas where our oil and natural gas exploration and production customers operate, they could incur potentially significant added costs to comply with such requirements, experience delays or curtailment in the pursuit of exploration, development, and production activities, and perhaps even be precluded from drilling wells, some or all of which could adversely affect demand for our products and services from those customers. 22 Table of Contents Our financial results could be adversely impacted by changes in regulation of oil and natural gas exploration and development activity in response to significant environmental incidents or climate change actions.
If new or more stringent federal, state or local legal restrictions relating to the hydraulic fracturing process are adopted in areas where our oil and natural gas exploration and production customers operate, they could incur potentially significant added costs to comply with such requirements, experience delays or curtailment in the pursuit of exploration, development, and production activities, and perhaps even be precluded from drilling wells, some or all of which could adversely affect demand for our products and services from those customers.
We anticipate that such code testing requirements will become more common in our contracts.
We anticipate that such code testing requirements will become more common in our 16 Table of Contents contracts.
In addition, our amended and restated bylaws establish advance notice provisions for stockholder proposals and nominations for elections to the board of directors to be acted upon at meetings of stockholders. We have incurred impairment charges and we may incur additional impairment charges in the future.
In addition, our amended and restated bylaws establish advance notice provisions for stockholder proposals and nominations for elections to the board of directors to be acted upon at meetings of stockholders. 27 Table of Contents During the year ended December 31, 2024, we incurred impairment charges and we may incur additional impairment charges in the future.
In the past, global economic conditions, and expectations for future global economic conditions, have sometimes experienced significant deterioration in a relatively short period of time and there can be no assurance that global economic conditions or expectations for future global economic conditions will recover in the near term or not quickly deteriorate again due to one or more factors. 16 Table of Contents We may not be able to satisfy technical requirements, testing requirements, code requirements or other specifications under contracts and contract tenders.
In the past, global economic conditions, and expectations for future global economic conditions, have sometimes experienced significant deterioration in a relatively short period of time and there can be no assurance that global economic conditions or expectations for future global economic conditions will recover in the near term or not quickly deteriorate again due to one or more factors.
In addition, these risks may be greater for us because we may acquire companies that have not allocated significant resources and management focus to quality or safety, requiring rehabilitative efforts during the integration process. We may incur liabilities for losses associated with these newly acquired companies before we are able to rehabilitate such companies’ quality, safety and environmental programs.
In addition, these risks may be greater for us because we may acquire companies that have not allocated significant resources and management focus to quality or safety, requiring rehabilitative efforts during the integration process.
In August 2022, President Biden signed into law the Inflation Reduction Act, which contains tax inducements and other provisions that incentivize investment, development, and deployment of alternative energy sources and technologies, which could increase operating costs within the oil and gas industry and accelerate the transition away from fossil fuels. 25 Table of Contents Efforts have also been made and continue to be made in the international community toward the adoption of international treaties or protocols that would address global climate change issues.
In August 2022, President Biden signed into law the Inflation Reduction Act, which contains tax inducements and other provisions that incentivize investment, development, and deployment of alternative energy sources and technologies, which could increase operating costs within the oil and gas industry and accelerate the transition away from fossil fuels.
In addition, any future significant cancellations or deferrals of product orders or the return of previously sold products 14 Table of Contents could materially and adversely affect profit margins, increase product obsolescence and restrict our ability to fund our operations.
In addition, any future significant cancellations or deferrals of product orders or the return of previously sold products could materially and adversely affect profit margins, increase product obsolescence and restrict our ability to fund our operations. 14 Table of Contents We may not realize revenue on our current backlog due to customer order reductions, cancellations or acceptance delays, which may negatively impact our financial results.
Climate change legislation or regulations restricting emissions of GHGs and related divestment and other efforts could increase our operating costs or reduce demand for our products. Environmental advocacy groups and regulatory agencies in the U.S. and other countries have focused considerable attention on the emissions of carbon dioxide, methane and other GHGs and their potential role in climate change.
Environmental advocacy groups and regulatory agencies in the U.S. and other countries have focused considerable attention on the emissions of carbon dioxide, methane and other GHGs and their potential role in climate change.
In the event of a cybersecurity incident, we may be required to expend additional resources in order to enhance our cybersecurity measures and to investigate and remediate any vulnerabilities, which would increase our cybersecurity costs.
In the event of a cybersecurity incident, we may be required to expend additional resources in order to enhance our cybersecurity measures and to investigate and remediate any vulnerabilities, which would increase our cybersecurity costs. We also may incur large expenditures to recover data, to repair or replace networks or information systems or to protect against similar future events.
We may not realize revenue on our current backlog due to customer order reductions, cancellations or acceptance delays, which may negatively impact our financial results. Uncertainty regarding demand for our customers’ services has resulted in order reductions, cancellations and acceptance delays, and we may experience more of these in the future.
Uncertainty regarding demand for our customers’ services has resulted in order reductions, cancellations and acceptance delays, and we may experience more of these in the future.
We are also exposed to the impact of labor cost increases resulting from other factors such as high employment levels, increased wages offered by employers in other industries, and government regulations.
We are also exposed to the impact of labor cost increases resulting from other factors such as high employment levels, increased wages offered by employers in other industries, and government regulations. If any of these events were to occur, our ability to respond quickly to customer demands may be inhibited and our growth potential could be impaired.
Likewise, the market price of our common stock has varied significantly in the past. For example, in 2023, the market price of our common stock reached a high of $33.84 per share on February 10, 2023, and a low of $19.31 per share on December 12, 2023.
Likewise, the market price of our common stock has varied significantly in the past. For example, in 2024, the market price of our common stock reached a high of $23.21 per share on January 2, 2024, and a low of $12.83 per share on November 1, 2024.
In May 2023, the EPA proposed to vacate the ACE rule and establish control methods to reduce the GHG emissions of power generation sector through control methods that include carbon capture and storage, low-GHG hydrogen co-firing and natural gas co-firing. • In August 2020, the EPA rescinded methane and volatile organic compound emissions standards for new and modified oil and gas transmission and storage infrastructure previously promulgated in 2016, as well as methane limits for new and modified oil and gas production and processing equipment.
In May 2023, the EPA proposed to vacate the ACE rule and establish control methods to reduce the GHG emissions of power generation sector through control methods that include carbon capture and storage, low-GHG hydrogen co-firing and natural gas co-firing.
Assuming all loans available under our amended Credit Facility upon closing of the Variperm Acquisition are fully drawn, each quarter point change in interest rates would result in an approximately $0.6 million change in annual interest expense on our indebtedness under our Credit Facility.
Assuming borrowings under our amended Credit Facility outstanding as of December 31, 2024, each quarter point change in interest rates would result in an approximately $0.2 million change in annual interest expense on our indebtedness under our Credit Facility.
Although during 2022 and 2023, oil and gas prices and demand increased significantly from the historic lows seen in the first half of 2020, it is uncertain whether prices will maintain current levels, decline or increase.
Although during 2023 and 2024, oil and gas prices and demand remained relatively steady, it is uncertain whether prices will maintain current levels, decline or increase.
Our senior secured asset-based lending facility (the “Credit Facility”) and our second lien seller term loan credit agreement we entered into to fund a portion of the purchase price of the Variperm Acquisition (the “Seller Term Loan”) also contain covenants, which, among other things, require us in certain circumstances, on a consolidated basis, to maintain specified financial ratios or conditions.
Our senior secured asset-based lending facility (the “Credit Facility”) and the bond terms (the “Bond Terms”) that govern our outstanding 10.50% senior secured bonds (the “2029 Bonds”) also contain covenants, which, among other things, require us in certain circumstances, on a consolidated basis, to maintain specified financial ratios or conditions.
In some cases, the suppliers own the intellectual property rights to the products we sell, or possess the technology or specialized tooling required to manufacture them.
We rely on relationships with key suppliers to operate and maintain our business. Certain of our product lines depend on a limited number of third-party suppliers. In some cases, the suppliers own the intellectual property rights to the products we sell, or possess the technology or specialized tooling required to manufacture them.
Our efforts to mitigate the impact of tariffs on raw materials through the diversification of our supply chain, exemption requests and other measures may not be sufficiently successful. Furthermore, a prolonged imposition of tariffs on our goods could have a significant adverse effect on our results of operations.
More recently, the Trump Administration has proposed significantly increased tariffs on foreign imports into the U.S., particularly from China, which may impact our cost of raw materials. Our efforts to mitigate the impact of tariffs on raw materials through the diversification of our supply chain, exemption requests and other measures may not be sufficiently successful.
We are subject to litigation risks that may not be covered by insurance.
Furthermore, a prolonged imposition of tariffs on our goods could have a significant adverse effect on our results of operations. We are subject to litigation risks that may not be covered by insurance.
Many of our products are used in harsh environments and severe service applications.
We may not be able to satisfy technical requirements, testing requirements, code requirements or other specifications under contracts and contract tenders. Many of our products are used in harsh environments and severe service applications.
The adoption of additional legislation or regulatory programs to reduce emissions of GHGs could require us to incur increased operating costs to comply with new emissions-reduction or reporting requirements.
While it is not possible at this time to predict how any such actions may impact our business, such actions could reduce activity from federal, state, and local legislative bodies and administrative agencies and the number of GHG laws, regulations, and other binding commitments. 24 Table of Contents The adoption of additional legislation or regulatory programs to reduce emissions of GHGs could require us to incur increased operating costs to comply with new emissions-reduction or reporting requirements.
The White House has also taken actions targeting emissions of GHGs.
Additionally, at the end of 2024, EPA announced proposed amendment to the NSPS with additional emissions standards and limitations for GHGs and other hazardous air pollutants. The White House has also taken actions targeting emissions of GHGs.
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Furthermore, we may be adversely affected by disputes regarding intellectual property rights. • We may incur liabilities, fines, penalties or additional costs, or we may be unable to sell to certain customers if we do not maintain safe operations. • If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or prevent fraud. • The impact and effects of public health crises, pandemics and epidemics could have a material adverse effect on our business, financial condition and results of operations. • Facility consolidations or expansions may subject us to risks of operating inefficiencies, construction delays and cost overruns. • Our acquisitions and dispositions may not result in anticipated benefits and may present risks not originally contemplated. • A natural disaster, catastrophe or other event could result in severe property damage, which could curtail our operations.
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Our financial results could be adversely impacted by changes in regulation of oil and natural gas exploration and development activity in response to significant environmental incidents or climate change actions.
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Risks Related to the Variperm Acquisition: • We may not be able to integrate Variperm successfully or manage the combined business effectively, and the benefits of acquiring Variperm may not be realized or may not be realized within the expected time frame. • Variperm may have liabilities that are not known, probable or estimable at this time. 11 Table of Contents • We will incur significant costs in connection with the Variperm Acquisition, which may be in excess of those anticipated. • Failure to retain key employees and attract new talent to fill new roles created by the integration or vacant roles created by attrition could diminish the anticipated benefits of the Variperm Acquisition and otherwise harm our business.
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Further, there exists the potential that the Trump Administration pursues new or amended laws, regulations, executive actions, or other initiatives that may alter restrictions on hydraulic fracturing activities and states may act to further regulate such activities in the absence of federal regulations or in light of regulatory uncertainty.
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If any of these events were to occur, our ability to respond quickly to customer demands may be inhibited and our growth potential could be impaired. 15 Table of Contents We rely on relationships with key suppliers to operate and maintain our business. Certain of our product lines depend on a limited number of third-party suppliers.
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We may incur liabilities for losses associated with these newly acquired companies before we are able to rehabilitate such companies’ quality, safety and environmental programs. 23 Table of Contents Climate change legislation or regulations restricting emissions of GHGs and related divestment and other efforts could increase our operating costs or reduce demand for our products.
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We also may incur large expenditures to recover data, to repair or replace networks or information systems or to protect against similar future events. 17 Table of Contents Our success depends on our ability to implement new technologies and services more efficiently and quickly than our competitors.
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In April 2024, the EPA published rules to regulate greenhouse gas emissions from fossil fuel-fired power plants (Clean Power Plan 2.0), which faced immediate criticism and challenges. • In August 2020, the EPA rescinded methane and volatile organic compound emissions standards for new and modified oil and gas transmission and storage infrastructure previously promulgated in 2016, as well as methane limits for new and modified oil and gas production and processing equipment.
Removed
Risks Related to the Variperm Acquisition: We may not be able to integrate Variperm successfully or manage the combined business effectively, and the benefits of acquiring Variperm may not be realized or may not be realized within the expected time frame. We consummated the Variperm Acquisition with the expectation that it would result in various benefits.
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There is ongoing D.C. Circuit litigation for these standards, and in October 2024, the U.S. Supreme Court denied industry and state petitioners’ applications to stay the implementation of the rule while merits of the challenges are litigated.
Removed
Achieving the anticipated benefits of the Variperm Acquisition is subject to a number of uncertainties, including whether the businesses of FET and Variperm can be integrated in an efficient and effective manner. We will be required to devote significant management attention and resources to integrating Variperm’s operations into our operations.
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Efforts have also been made and continue to be made in the international community toward the adoption of international treaties or protocols that would address global climate change issues.
Removed
Delays or unexpected difficulties in the integration process may cause the anticipated benefits of the Variperm Acquisition to not be fully realized or to take longer to realize than expected.
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Although the Biden Administration officially reentered the U.S. into the Paris Agreement in February 2021, the Trump Administration signed an executive order withdrawing the U.S. from the agreement in January 2025.
Removed
Issues that must be addressed in integrating Variperm’s operations include, among other things: • conforming standards, controls, procedures and policies, business cultures and compensation structures; • integrating supply chain, procurement, corporate, accounting, information technology, communications, administration and other systems; • consolidating sales and marketing operations; • retaining existing customers and attracting new customers; • retaining key employees and attracting new talent to fill new roles created by the integration or vacant roles created by attrition; • identifying and eliminating redundant and underperforming operations and assets; • minimizing the diversion of management’s attention from ongoing business concerns; • operating the combined business in markets and geographies in which we do not currently operate; and 20 Table of Contents • managing tax costs or inefficiencies associated with integrating Variperm’s and FET’s operations.
Added
For goodwill, an assessment for impairment is performed annually or when there is an indication an impairment may have occurred. Goodwill is reviewed for impairment by comparing the carrying value of each reporting unit’s net assets, including allocated goodwill, to the estimated fair value of the reporting unit.
Removed
Failure to achieve the anticipated benefits of the Variperm Acquisition could adversely affect our future business, financial condition, results of operations and prospects. Even if we are able to integrate Variperm’s operations successfully, this integration may not result in the realization of the full benefits we expect or the achievement of these benefits within a reasonable period of time.
Added
We determine the fair value of each of our seven reporting units using a discounted cash flow approach. Determining the fair value of a reporting unit requires the use of estimates and assumptions.
Removed
In addition, we may have not discovered during the due diligence process prior to closing all known and unknown factors regarding Variperm that could produce unintended and unexpected consequences for us.
Added
If the reporting unit’s carrying value is greater than its calculated fair value, we recognize a goodwill impairment charge for the amount by which the carrying value of goodwill exceeds its fair value. There was no impairment of goodwill during the year ended December 31, 2024.
Removed
Undiscovered factors could result in us incurring financial liabilities, which could be material, and could result in us not achieving the expected benefits from the Variperm Acquisition within our desired time frames, or at all. Variperm may have liabilities that are not known, probable or estimable at this time.
Added
There are significant inherent uncertainties and management judgment in estimating the fair value of each reporting unit. While we believe we have made reasonable estimates and assumptions to estimate the fair value of our reporting units, it is possible that a material change could occur.
Removed
As a result of the Variperm Acquisition, Variperm has become our wholly-owned subsidiary, and we effectively assume all of Variperm’s liabilities, whether or not currently known. There may be claims, assessments or liabilities that we did not discover or identify in the course of performing due diligence investigations of Variperm.
Added
If actual results are not consistent with our current estimates and assumptions, or if changes in macroeconomic conditions outside the control of management change such that it results in a significant negative impact to our estimated fair values, the fair value of these reporting units may decrease below their net carrying value, which could result in a material impairment of our goodwill.
Removed
In addition, there may be liabilities that are neither probable nor estimable at this time which may become probable and estimable in the future. Any such liabilities, individually or in the aggregate, could have a material adverse effect on our business.
Added
For the year ended December 31, 2024, we recognized intangible asset impairment charges totaling $119.1 million, which are included in “Impairment of intangible assets” in the consolidated statements of comprehensive loss. See Note 7 Goodwill and Intangible Assets for further information related to these charges. There was no impairment of intangible assets during the year ended December 31, 2023.
Removed
We may uncover additional information about Variperm that adversely affects us, such as unknown, unasserted or contingent liabilities and issues relating to compliance with applicable laws. We will incur significant costs in connection with the Variperm Acquisition, which may be in excess of those anticipated.
Removed
We have incurred and expect to continue to incur a number of non-recurring costs associated with negotiating and completing the Variperm Acquisition and combining the operations of FET and Variperm. These fees and costs have been, and will continue to be, substantial.
Removed
A significant portion of such expenses consist of transaction costs related to the Variperm Acquisition and include, among others, fees and expenses of professional advisors, including legal and accounting advisors, and financing costs. We will also incur fees and costs related to the integration of FET and Variperm, which could include severance costs and capital expenditures.
Removed
Moreover, we may incur additional unanticipated expenses in connection with the integration. Although we expect the elimination of duplicative costs and the realization of other efficiencies related to the integration of Variperm into FET’s operations to offset integration-related costs over time, this net benefit may not be achieved in the near term, or at all.
Removed
We cannot assure you that we will successfully integrate the Variperm business. The costs described above, as well as other unanticipated costs and expenses, could have a material adverse effect on the financial condition and operating results of the combined company following the completion of the Variperm Acquisition.
Removed
Failure to retain key employees and attract new talent to fill new roles created by the integration or vacant roles created by attrition could diminish the anticipated benefits of the Variperm Acquisition and otherwise harm our business.
Removed
The success of our business, including the Variperm Acquisition, will depend in part upon the retention of key employees critical to the Variperm business. Current employees may experience uncertainty about their future roles until clear strategies are announced or executed. Some Variperm employees may choose not to remain with the combined company.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn addition to our internal cybersecurity capabilities, we also regularly engage consultants to assist with assessing, identifying, and managing cybersecurity risks and optimize infrastructure. Risk Management and Strategy Assessing, identifying and managing cybersecurity risks are integral to our enterprise risk management activities. Our cybersecurity program leverages people, processes, and technology to timely identify and respond to cybersecurity threats.
Biggest changeRisk Management and Strategy Assessing, identifying and managing cybersecurity risks are integral to our enterprise risk management activities. Our cybersecurity program leverages people, processes, and technology to timely identify and respond to cybersecurity threats. The Company has access control systems to limit physical and virtual access into our system to authorized users.
Cybersecurity incidents may lead to reputational harm, revenue and client loss, legal 30 Table of Contents actions, and statutory penalties, among other consequences. Additional information on cybersecurity risks we face are discussed in Item 1A “Risk Factors,” which should be read in conjunction with the foregoing information. 31 Table of Contents
Cybersecurity incidents may lead to reputational harm, revenue and client loss, legal actions, and statutory penalties, among other consequences. Additional information on cybersecurity risks we face are discussed in Item 1A “Risk Factors,” which should be read in conjunction with the foregoing information. 30 Table of Contents
The executive management team, including our Chief Executive Officer, Chief Financial Officer and General Counsel, is responsible for (i) approving and reviewing any changes to the policies; (ii) ensuring necessary resources; (iii) defining information that is considered strategically important; (iv) reviewing and approving information security objectives on annual basis; and (v) driving continued improvement and communicate importance of information security to the organization.
The executive management team, including our Chief Executive Officer, Chief Financial Officer and General Counsel, is responsible for (i) approving and reviewing any changes to the policies; (ii) ensuring necessary resources; (iii) defining information that is considered strategically important; (iv) reviewing and approving information security objectives on annual basis; and (v) driving continued improvement and communicating the importance of information security to the organization.
The IT Director receives regular reports on cybersecurity threats from the internal cybersecurity team and reviews risk management measures designed and implemented by the Company to identify and mitigate data protection and cybersecurity threats. Our IT Director works with the General Counsel and other members of the Legal Department to oversee compliance with legal, regulatory and contractual security requirements.
The IT Director receives regular reports on cybersecurity threats from the internal cybersecurity team and reviews risk management measures designed and implemented by the Company to identify and mitigate data protection and cybersecurity threats. Our IT Director works with the General Counsel and other members of the Legal Department to ensure compliance with legal, regulatory and contractual security requirements.
The IT Director also periodically attends the Board’s Audit Committee meetings to report on developments impacting the IT Department and discuss annual cybersecurity goals and initiatives. 29 Table of Contents Internal Cybersecurity Team Our internal cybersecurity team is responsible for the development, implementation, monitoring, and maintenance of the cybersecurity and data protection practices across the Company.
The IT Director also periodically attends the Board’s Audit Committee meetings to report on developments impacting the IT Department and discuss annual cybersecurity goals and initiatives. Internal Cybersecurity Team Our internal cybersecurity team is responsible for the development, implementation, monitoring, and maintenance of the cybersecurity and data protection practices across the Company.
In general, our incident response process follows the National Institute of Standards and Technology framework and focuses on four phases: preparation; detection and analysis; containment, eradication and recovery; and post-incident remediation.
In general, our incident response process follows the National Institute of Standards and Technology framework and focuses on four phases: 29 Table of Contents preparation; detection and analysis; containment, eradication and recovery; and post-incident remediation.
As part of such reviews, the Audit Committee receives reports and presentations from members of our team responsible for overseeing the Company’s cybersecurity risk management, including senior members of our IT, Finance and Accounting, and Legal teams. We have protocols by which certain cybersecurity incidents are escalated within the Company and, where appropriate, reported to the Audit Committee.
As part of such reviews, the Audit Committee receives reports and presentations from members of our team responsible for overseeing the Company’s cybersecurity risk management, including senior members of our IT, Finance and Accounting, and Legal teams.
The Company has access control systems to limit physical and virtual access into our system to authorized users. In addition, we utilize services and software from third-party providers to monitor the Company’s network and obtain expeditious alerts of anomalous activity. The Company takes a risk-based approach to manage cybersecurity risks and reviews third-party reports to oversee and identify cybersecurity threats.
In addition, we utilize services and software from third-party providers to monitor the Company’s network and obtain expeditious alerts of anomalous activity. The Company takes a risk-based approach to manage cybersecurity risks and reviews third-party reports to oversee and identify cybersecurity threats. The Company maintains cybersecurity insurance to defray costs associated with a cybersecurity incident.
Management The executive management team, including our Chief Executive Officer, Chief Financial Officer and General Counsel, receives periodic reports from the IT Director regarding cybersecurity objectives and risk management measures being implemented by the Company and discusses these updates to identify and mitigate data protection and cybersecurity risks.
We have protocols by which certain cybersecurity incidents are escalated within the Company and, where appropriate, reported to the Audit Committee and/or Board. 28 Table of Contents Management The executive management team, including our Chief Executive Officer, Chief Financial Officer and General Counsel, receives periodic reports from the IT Director regarding cybersecurity objectives and risk management measures being implemented by the Company and discusses these updates to identify and mitigate data protection and cybersecurity risks.
The IRP sets out a coordinated approach to investigating, containing, documenting and mitigating incidents, including reporting findings and keeping senior management and other key stakeholders informed and involved as appropriate.
Incident Response We have implemented a Cybersecurity Incident Response Plan (the “IRP”) that applies in the event of a cybersecurity incident to provide a standardized framework for responses. The IRP sets out a coordinated approach to investigating, containing, documenting and mitigating incidents, including reporting findings and keeping senior management and other key stakeholders informed and involved as appropriate.
Reporting to our IT Director are experienced personnel with training to assist with managing cybersecurity objectives and to implement related policies and tools. Our internal cybersecurity team includes a manager who is a Certified Information Systems Security Professional and Systems Security Certified Practitioner. Also, the internal cybersecurity team conducts periodic security awareness training for employees.
Reporting to our IT Director are experienced personnel who assist with managing cybersecurity objectives and to implement related policies and tools. Also, the internal cybersecurity team conducts periodic security awareness training for employees. In addition to our internal cybersecurity capabilities, we also regularly engage consultants to assist with assessing, identifying, and managing cybersecurity risks and optimize infrastructure.
Removed
The Company maintains cybersecurity insurance to defray costs associated with an information security incident.
Removed
Incident Response We have implemented a Cybersecurity Incident Response Plan that applies in the event of a cybersecurity threat or incident (the “IRP”) to provide a standardized framework for responding to cybersecurity incidents.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeProperties The following table describes the significant facilities owned or leased by us as of December 31, 2023, for our Drilling & Downhole (“D&D”), Completions (“C”) and Production (“P”) segments: Country Location Number of facilities Description Leased or Owned Segments Canada Red Deer 2 Service/Distribution Leased C Calgary 1 Manufacturing Leased C Edmonton 2 Service/Distribution Leased Shared Grande Prairie 1 Service/Distribution Leased C Germany Hamburg 1 Manufacturing Leased D&D Saudi Arabia Dammam 1 Manufacturing/Distribution Owned Shared UAE Jebel Ali 1 Service/Distribution Leased D&D United Kingdom Aberdeen 1 Service/Distribution Leased D&D Kirkbymoorside 1 Manufacturing Owned D&D United States Broussard, LA 1 Manufacturing/Service/Distribution Leased Shared Bryan, TX 1 Manufacturing Leased Shared Clearfield, PA 1 Manufacturing/Service/Distribution Owned P Dayton, TX 1 Manufacturing Owned C Fort Worth, TX 1 Manufacturing/Service Leased C Guthrie, OK 1 Manufacturing Leased P Houston, TX 2 Corporate/Manufacturing Leased Shared Humble, TX 1 Manufacturing Leased C Midland, TX 1 Service/Distribution Leased C Odessa, TX 1 Service/Distribution Leased C Odessa, TX 1 Service/Distribution Leased D&D Pearland, TX 1 Manufacturing/Distribution Owned D&D Plantersville, TX 1 Manufacturing/Distribution Leased D&D Smock, PA 1 Service Leased C Stafford, TX 1 Manufacturing/Distribution Leased P Stafford, TX 1 Manufacturing Owned D&D Tyler, TX 1 Distribution Leased D&D Williston, ND 1 Service/Distribution Leased Shared We believe our facilities are suitable for their present and intended purposes, and are adequate for our current and anticipated level of operations.
Biggest changeProperties The following table describes the significant facilities owned or leased by us as of December 31, 2024, for our Drilling and Completions (“D&C”) and Artificial Lift and Downhole (“A&D”) segments: Country Location Number of facilities Description Leased or Owned Segments Canada Red Deer 2 Service/Distribution Leased D&C Calgary 1 Manufacturing Leased D&C Calgary 1 Manufacturing/Service/Distribution Leased A&D Edmonton 2 Service/Distribution Leased D&C Edmonton 2 Manufacturing/Service/Distribution Leased A&D Germany Hamburg 1 Manufacturing Leased D&C Saudi Arabia Dammam 1 Manufacturing/Distribution Owned Shared UAE Jebel Ali 1 Service/Distribution Leased Shared United Kingdom Aberdeen 1 Service/Distribution Leased D&C Kirkbymoorside 1 Manufacturing Owned D&C United States Broussard, LA 1 Manufacturing/Service/Distribution Leased D&C Bryan, TX 1 Manufacturing Leased D&C Clearfield, PA 1 Manufacturing/Service/Distribution Owned A&D Dayton, TX 1 Manufacturing Leased D&C Fort Worth, TX 1 Manufacturing/Service Leased D&C Guthrie, OK 1 Manufacturing Leased A&D Houston, TX 2 Corporate/Manufacturing Leased Shared Humble, TX 1 Manufacturing Leased D&C Midland, TX 1 Service/Distribution Leased D&C Odessa, TX 1 Service/Distribution Leased D&C Odessa, TX 1 Service/Distribution Leased A&D Pearland, TX 1 Manufacturing/Distribution Owned A&D Plantersville, TX 1 Manufacturing/Distribution Leased D&C Smock, PA 1 Service Leased D&C Stafford, TX 2 Manufacturing/Distribution Leased A&D Tyler, TX 1 Distribution Leased D&C Williston, ND 1 Service/Distribution Leased Shared We believe our facilities are suitable for their present and intended purposes, and are adequate for our current and anticipated level of operations.
We incorporate by reference the information set forth in Item 1 and Item 7 of this Annual Report on Form 10-K and the information set forth in Note 6 Property and Equipment, Note 9 Leases and Note 12 Commitments and Contingencies . 32 Table of Contents
We incorporate by reference the information set forth in Item 1 and Item 7 of this Annual Report on Form 10-K and the information set forth in Note 6 Property and Equipment, Note 9 Leases and Note 12 Commitments and Contingencies . 31 Table of Contents

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures Not applicable. Information About Our Executive Officers The following table indicates the names, ages and positions of the executive officers of FET as of February 29, 2024: Name Age Position Neal A. Lux 48 President and Chief Executive Officer D. Lyle Williams 54 Executive Vice President and Chief Financial Officer John C.
Biggest changeItem 4. Mine Safety Disclosures Not applicable. Information About Our Executive Officers The following table indicates the names, ages and positions of the executive officers of FET as of February 21, 2025: Name Age Position Neal A. Lux 49 President, Chief Executive Officer and Director D. Lyle Williams 55 Executive Vice President and Chief Financial Officer John C.
Danford served as Director of Human Resources and Vice President 33 Table of Contents - Human Resources for Hydril Company, a publicly traded manufacturer of connections used for oil and natural gas drilling and production. From 1991 to 1997, Mr. Danford served in various human resources roles for Baker Hughes Incorporated, a publicly traded oilfield services company.
Danford served as Director of Human Resources and Vice President 32 Table of Contents - Human Resources for Hydril Company, a publicly traded manufacturer of connections used for oil and natural gas drilling and production. From 1991 to 1997, Mr. Danford served in various human resources roles for Baker Hughes Incorporated, a publicly traded oilfield services company.
Pounds held various positions of increasing responsibility with Baker Hughes International, most recently as Senior Director – Strategic Sourcing. Mr. Pounds holds a B.S. in Mechanical Engineering from The University of Texas at Austin. 34 Table of Contents PART II
Pounds held various positions of increasing responsibility with Baker Hughes International, most recently as Senior Director – Strategic Sourcing. Mr. Pounds holds a B.S. in Mechanical Engineering from The University of Texas at Austin. 33 Table of Contents PART II
Ivascu 46 Executive Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary Michael D. Danford 61 Senior Vice President and Chief Human Resources Officer Katherine C. Keller 40 Senior Vice President and Chief Accounting Officer Mark Brookes 48 Senior Vice President – Operations Steven Pounds 51 Senior Vice President – Operations Neal A. Lux. Mr.
Ivascu 47 Executive Vice President, General Counsel, Chief Compliance Officer and Corporate Secretary Michael D. Danford 62 Senior Vice President and Chief Human Resources Officer Katherine C. Keller 41 Senior Vice President and Chief Accounting Officer Mark Brookes 49 Senior Vice President – Operations Steven Pounds 52 Senior Vice President – Operations Neal A. Lux. Mr.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchase of Equity Securities In November 2021, our board of directors approved a program for the repurchase of outstanding shares of our common stock with an aggregate purchase amount of up to $10.0 million.
Biggest changePurchase of Equity Securities Our board of directors approved programs for the repurchase of outstanding shares of our common stock with an aggregate purchase amount of up to $10.0 million (the “November 2021 Program”) and $75.0 million (the “December 2024 Program”), in November 2021 and December 2024, respectively.
In calculating the number of shareholders, we consider clearing agencies and security position listings as one shareholder for each agency or listing. No dividends were declared or issued during 2023 or 2022, and we do not currently have any plans to pay cash dividends in the future.
In calculating the number of shareholders, we consider clearing agencies and security position listings as one shareholder for each agency or listing. No dividends were declared or issued during 2024 or 2023, and we do not currently have any plans to pay cash dividends in the future.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock trades on the NYSE under the trading symbol “FET.” As of February 29, 2024, there were approximately 45 common stockholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock trades on the NYSE under the trading symbol “FET.” As of February 21, 2025, there were approximately 26 common stockholders of record.
Shares may be repurchased under the program from time to time, in amounts and at prices that the company deems appropriate, subject to market and business conditions, applicable legal requirements and other considerations.
The December 2024 Program replaced the authority granted under the November 2021 Program. Shares may be repurchased under the December 2024 Program from time to time, in amounts and at prices that the Company deems appropriate, subject to market and business conditions, applicable legal requirements and other considerations.
From the inception of the program through December 31, 2023, we have repurchased approximately 298 thousand shares of our common stock for aggregate consideration of $7.6 million. Remaining authorization under this program is $2.4 million. No shares were purchased during the three months ended December 31, 2023. Item 6. Reserved. 35 Table of Contents
From the inception of the November 2021 Program through December 2024, we repurchased approximately 298 thousand shares of our common stock for aggregate consideration of $7.6 million. No shares were purchased during the three months ended December 31, 2024 under our November 2021 Program or our December 2024 Program.
Added
As of December 31, 2024, remaining authorization under the December 2024 Program is $75.0 million. Subsequent to December 31, 2024, we repurchased approximately 105 thousand shares of our common stock for aggregate consideration of $2.0 million. Item 6. Reserved. 34 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

53 edited+27 added−26 removed34 unchanged
Biggest changeActive Rigs 687 723 The table below shows the amount of total inbound orders by segment for the years ended December 31, 2023 and 2022: (in millions of dollars) 2023 2022 Orders: Drilling & Downhole $ 337.0 $ 305.8 Completions 251.9 278.5 Production 135.4 196.4 Total Orders $ 724.3 $ 780.7 38 Table of Contents Results of operations Year ended December 31, Change (in thousands of dollars, except per share information) 2023 2022 $ % Revenue Drilling & Downhole $ 329,576 $ 304,565 $ 25,011 8.2 % Completions 265,628 264,951 677 0.3 % Production 145,864 131,519 14,345 10.9 % Eliminations (2,204) (1,122) (1,082) * Total revenue $ 738,864 $ 699,913 $ 38,951 5.6 % Cost of sales Drilling & Downhole $ 222,933 $ 206,976 $ 15,957 7.7 % Completions 203,057 201,371 1,686 0.8 % Production 110,925 104,162 6,763 6.5 % Eliminations (2,204) (1,122) (1,082) * Total cost of sales $ 534,711 $ 511,387 $ 23,324 4.6 % Gross profit Drilling & Downhole $ 106,643 $ 97,589 $ 9,054 9.3 % Completions 62,571 63,580 (1,009) (1.6) % Production 34,939 27,357 7,582 27.7 % Total gross profit $ 204,153 $ 188,526 $ 15,627 8.3 % Selling, general and administrative expenses: Drilling & Downhole $ 72,876 $ 65,388 $ 7,488 11.5 % Completions 51,783 52,015 (232) (0.4) % Production 28,477 27,800 677 2.4 % Corporate 27,253 34,268 (7,015) (20.5) % Total selling, general and administrative expenses $ 180,389 $ 179,471 $ 918 0.5 % Segment operating income (loss) Drilling & Downhole $ 33,767 $ 32,201 $ 1,566 4.9 % Operating margin % 10.2 % 10.6 % Completions 10,788 11,565 (777) (6.7) % Operating margin % 4.1 % 4.4 % Production 6,462 (443) 6,905 1,558.7 % Operating margin % 4.4 % (0.3) % Corporate (27,253) (34,268) 7,015 20.5 % Total segment operating income $ 23,764 $ 9,055 $ 14,709 162.4 % Operating margin % 3.2 % 1.3 % Transaction expenses 2,892 — 2,892 * Gain on sale-leaseback transactions — (7,000) 7,000 * Loss (gain) on disposal of assets and other 156 (1,271) 1,427 * Operating income 20,716 17,326 3,390 19.6 % Interest expense 18,297 31,525 (13,228) (42.0) % Foreign exchange losses (gains) and other, net 10,233 (24,548) 34,781 * Total other expense 28,530 6,977 21,553 * Income (loss) before income taxes (7,814) 10,349 (18,163) (175.5) % Income tax expense 11,062 6,637 4,425 * Net income (loss) $ (18,876) $ 3,712 $ (22,588) (608.5) % Weighted average shares outstanding Basic 10,212 5,747 Diluted 10,212 5,951 Earnings (loss) per share Basic $ (1.85) $ 0.65 Diluted $ (1.85) $ 0.62 * not meaningful 39 Table of Contents Revenues Our revenue for the year ended December 31, 2023 was $738.9 million, an increase of $39.0 million, or 5.6%, compared to the year ended December 31, 2022.
Biggest changeActive Rigs 599 687 36 Table of Contents The table below shows the amount of total inbound orders by segment for the years ended December 31, 2024 and 2023: (in millions of dollars) 2024 2023 Orders: Drilling and Completions $ 459.2 $ 497.0 Artificial Lift and Downhole 321.1 227.3 Total Orders $ 780.3 $ 724.3 37 Table of Contents Results of operations Year ended December 31, Change (in thousands of dollars, except per share information) 2024 2023 $ % Revenue Drilling and Completions $ 470,767 $ 502,622 $ (31,855) (6.3) % Artificial Lift and Downhole 345,680 236,312 109,368 46.3 % Eliminations (22) (70) 48 * Total revenue $ 816,425 $ 738,864 $ 77,561 10.5 % Cost of sales Drilling and Completions $ 348,878 $ 376,882 $ (28,004) (7.4) % Artificial Lift and Downhole 212,536 157,899 54,637 34.6 % Eliminations (22) (70) 48 * Total cost of sales $ 561,392 $ 534,711 $ 26,681 5.0 % Gross profit Drilling and Completions $ 121,889 $ 125,740 $ (3,851) (3.1) % Artificial Lift and Downhole 133,144 78,413 54,731 69.8 % Total gross profit $ 255,033 $ 204,153 $ 50,880 24.9 % Selling, general and administrative expenses Drilling and Completions $ 104,123 $ 106,306 $ (2,183) (2.1) % Artificial Lift and Downhole 84,250 46,830 37,420 79.9 % Corporate 30,952 27,253 3,699 13.6 % Total selling, general and administrative expenses $ 219,325 $ 180,389 $ 38,936 21.6 % Segment operating income (loss) Drilling and Completions $ 17,766 $ 19,434 $ (1,668) (8.6) % Operating margin % 3.8 % 3.9 % Artificial Lift and Downhole 48,894 31,583 17,311 54.8 % Operating margin % 14.1 % 13.4 % Corporate (30,952) (27,253) (3,699) (13.6) % Total segment operating income $ 35,708 $ 23,764 $ 11,944 50.3 % Operating margin % 4.4 % 3.2 % Transaction expenses 7,728 2,892 4,836 * Impairment of intangible assets 119,123 — 119,123 * Gain on sale-leaseback transactions (4,860) — (4,860) * Loss on disposal of assets and other 484 156 328 * Operating income (loss) (86,767) 20,716 (107,483) (518.8) % Interest expense 31,490 18,297 13,193 72.1 % Loss on extinguishment of debt 2,854 — 2,854 * Foreign exchange losses and other, net 7,315 10,233 (2,918) * Total other expense 41,659 28,530 13,129 * Loss before income taxes (128,426) (7,814) (120,612) (1,543.5) % Income tax expense 6,900 11,062 (4,162) * Net loss $ (135,326) $ (18,876) $ (116,450) (616.9) % Weighted average shares outstanding Basic 12,299 10,212 Diluted 12,299 10,212 Loss per share Basic $ (11.00) $ (1.85) Diluted $ (11.00) $ (1.85) * not meaningful 38 Table of Contents Revenues Our revenue for the year ended December 31, 2024 was $816.4 million, an increase of $77.6 million, or 10.5%, compared to the year ended December 31, 2023.
This may be the result of various factors, including, but not limited to, those factors discussed in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Annual Report on Form 10-K. Item 7A. Quantitative and qualitative disclosures about market risk Not required under Regulation S-K for “smaller reporting companies.” 46
This may be the result of various factors, including, but not limited to, those factors discussed in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Annual Report on Form 10-K. Item 7A. Quantitative and qualitative disclosures about market risk Not required under Regulation S-K for “smaller reporting companies.” 44
Key estimates related to long-lived assets include useful lives and recoverability of carrying values and changes in such estimates could have a significant impact on financial results. We review long-lived assets for potential impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable.
Key estimates related to long-lived assets include useful lives and recoverability of carrying values and changes in such estimates could have a significant impact on financial results. We review long-lived assets with definite lives for potential impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable.
The estimated annual effective tax rates for the years ended December 31, 2023 and 2022 were impacted by losses in jurisdictions where the recording of a tax benefit is not available. Furthermore, the tax expense or benefit recorded can vary from period to period depending on the Company’s relative mix of earnings and losses by jurisdiction.
The estimated annual effective tax rates for the years ended December 31, 2024 and 2023 were impacted by losses in jurisdictions where the recording of a tax benefit is not available. Furthermore, the tax expense or benefit recorded can vary from period to period depending on the Company’s relative mix of earnings and losses by jurisdiction.
Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this Annual Report on Form 10-K are reasonable, forward- 45 Table of Contents looking statements are not guarantees of future performance and involve risks and uncertainties that may cause actual results to differ materially from our plans, intentions or expectations.
Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this Annual Report on Form 10-K are reasonable, forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause actual results to differ materially from our plans, intentions or expectations.
Net cash used in financing activities Net cash used in financing activities was $7.6 million for the year ended December 31, 2023 including $6.0 million of cash used to repurchase of our common stock and $1.3 million of repayments of debt.
Net cash used in financing activities was $7.6 million for the year ended December 31, 2023 and included $6.0 million of cash used to repurchase our common stock and $1.3 million of net repayments of debt.
For the year ended December 31, 2023, approximately 94% of our revenue was recognized from goods transferred to customers at a point in time while 6% of our revenue was recognized from goods transferred to customers over time.
For the year ended December 31, 2024, approximately 94% of our revenue was recognized from goods transferred to customers at a point in time while 6% of our revenue was recognized from goods transferred to customers over time.
Our primary uses of capital have been for inventory, sales on credit to our customers, maintenance and growth capital expenditures, and debt repayments. We continually monitor other potential capital sources, including equity and debt financing, to meet our investment and target liquidity requirements.
Our primary uses of capital have been for inventory, sales on credit to our customers, maintenance and growth capital expenditures, debt repayments and the acquisition of Variperm. We continually monitor other potential capital sources, including equity and debt financing, to meet our investment and target liquidity requirements.
For the years ended December 31, 2023 and 2022, we recognized inventory write downs totaling $2.8 million and $2.7 million, respectively. These charges are all included in “ Cost of sales ” in the consolidated statements of comprehensive income (loss).
For the years ended December 31, 2024 and 2023, we recognized inventory write downs totaling $2.7 million and $2.8 million, respectively. These charges are all included in “ Cost of sales ” in the consolidated statements of comprehensive loss.
Corporate costs include, among other items, payroll related costs for management, administration, finance, legal, and human resources personnel; professional fees for legal, accounting and related services; and marketing costs. 40 Table of Contents Other items not included in segment operating income (loss) Several items are not included in segment operating income (loss), but are included in the total operating income.
Corporate costs include, among other items, payroll related costs for management, administration, finance, legal, and human resources personnel; professional fees for legal, accounting and related services; and marketing costs. Other items not included in segment operating income (loss) Several items are not included in segment operating income (loss), but are included in the total operating income (loss).
Net cash provided by (used in) investing activities Net cash used in investing activities was $6.6 million for the year ended December 31, 2023 including $7.9 million of capital expenditures, partially offset by $1.4 million of proceeds from the sale of property and equipment.
Net cash used in investing activities of $6.6 million for the year ended December 31, 2023 included $7.9 million of capital expenditures, partially offset by $1.4 million of proceeds from the sale of property and equipment.
In 2023, over 60% of our revenue was derived from consumable products and activity-based equipment, while the balance was primarily derived from capital products with a small amount from rental and other services. We expect that the world’s long-term energy demand will continue to rise for many decades.
In 2024, approximately 80% of our revenue was derived from consumable products and activity-based equipment, while the balance was primarily derived from capital products with a small amount from rental and other services. We expect that the world’s long-term energy demand will continue to rise for many decades.
Remaining authorization under this program is $2.4 million. In January 2024, we completed the Variperm Acquisition for consideration of $150.0 million of cash (subject to customary purchase price adjustments) and 2.0 million shares of our common stock. We may pursue additional acquisitions in the future, which may be funded with cash and/or equity.
In January 2024, we completed the Variperm Acquisition for consideration of $150.0 million of cash (subject to customary purchase price adjustments) and 2.0 million shares of our common stock. We may pursue additional acquisitions in the future, which may be funded with cash and/or equity.
While we have policies for calculating and recording reserves against inventory carrying values, we exercise judgment in establishing and applying these policies. As of December 31, 2023 and 2022, our inventory reserve balances were $38.2 million and $39.3 million, respectively.
While we have policies for calculating and recording reserves against inventory carrying values, we exercise judgment in establishing and applying these policies. As of December 31, 2024 and 2023, our inventory reserve balances were $35.7 million and $38.2 million, respectively.
In November 2021, our board of directors approved a program for the repurchase of outstanding shares of our common stock with an aggregate purchase amount of up to $10.0 million.
In December 2024, our board of directors approved a program for the repurchase of outstanding shares of our common stock with an aggregate purchase amount of up to $75.0 million.
International markets grew throughout 2023 and outpaced the U.S. and are expected to continue to grow in 2024. In the U.S., publicly owned exploration and production companies are expected to continue to exercise disciplined capital spending while privately owned exploration and production companies fluctuate their activity in response to changes in oil and natural gas prices.
In the U.S., publicly owned exploration and production companies are expected to continue to exercise disciplined capital spending while privately owned exploration and production companies fluctuate their activity in response to changes in oil and natural gas prices.
See Note 10 Income Taxes for further information related to these charges. The accounting guidance for income taxes requires that we recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit.
The accounting guidance for income taxes requires that we recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit.
Liquidity and capital resources Sources and uses of liquidity Our internal sources of liquidity are cash on hand and cash flows from operations, while our primary external sources include trade credit, the Credit Facility, the 2025 Notes and the Seller Term Loan.
Liquidity and capital resources Sources and uses of liquidity Our internal sources of liquidity are cash on hand and cash flows from operations, while our primary external sources include trade credit, the Credit Facility and the 2029 Bonds.
This segment designs, manufactures and supplies products and solutions for the production and infrastructure markets.
This segment designs, manufactures and supplies products and solutions for the artificial lift, well construction, production and infrastructure markets.
The table below shows average crude oil and natural gas prices for WTI, Brent, and Henry Hub: 2023 2022 Average global oil, $/bbl West Texas Intermediate $ 77.58 $ 94.90 United Kingdom Brent $ 82.49 $ 100.93 Average North American Natural Gas, $/Mcf Henry Hub $ 2.53 $ 6.45 37 Table of Contents The table below shows the average number of active drilling rigs operating by geographic area and drilling for different purposes based on the weekly rig count information published by Baker Hughes Company. 2023 2022 Active Rigs by Location United States 687 723 Canada 177 175 International 948 851 Global Active Rigs 1,812 1,749 Land vs.
The table below shows average crude oil and natural gas prices for WTI, Brent, and Henry Hub: 2024 2023 Average global oil, $/bbl West Texas Intermediate $ 76.45 $ 77.58 Brent $ 80.52 $ 82.49 Average North American Natural Gas, $/Mcf Henry Hub $ 2.19 $ 2.53 The table below shows the average number of active drilling rigs operating by geographic area and drilling for different purposes based on the weekly rig count information published by Baker Hughes Company. 2024 2023 Active Rigs by Location United States 599 687 Canada 187 177 International 948 948 Global Active Rigs 1,734 1,812 Land vs.
This segment designs, manufactures and supplies products and solutions to the drilling, artificial lift and subsea markets, including applications in oil and natural gas, renewable energy, defense and communications.
This segment designs, manufactures and supplies products and solutions to the drilling, subsea, coiled tubing, well stimulation and intervention markets, including applications in the oil and natural gas, renewable energy, defense and communications industries.
Our future success and growth will be highly dependent on our ability to generate positive operating cash flow and access outside sources of capital. We had outstanding $134.2 million principal amount of 2025 Notes and no borrowings under our Credit Facility as of December 31, 2023.
Our future success and growth will be highly dependent on our ability to generate positive operating cash flow and access outside sources of capital. As of December 31, 2024, we had $90.4 million of borrowings under our Credit Facility and $100.0 million outstanding principal amount of 2029 Bonds.
These budgets are heavily influenced by current and expected energy prices. In addition, demand for our capital products is driven by the utilization of service company equipment. Utilization is a function of equipment capacity and durability in demanding environments.
These budgets are heavily influenced by current and expected energy prices. In addition, demand for our capital products is driven by the utilization of service company equipment. Utilization is a function of equipment capacity and durability in demanding environments. Oil and natural gas average prices were lower in 2024 compared to 2023 full year average prices.
Shares may be repurchased under the program from time to time, in amounts and at prices that the company deems appropriate, subject to market and 41 Table of Contents business conditions, applicable legal requirements and other considerations. During 2023, we repurchased approximately 139 thousand shares of our common stock for aggregate consideration of approximately $3.5 million.
Shares may be repurchased under the program from time to time, in amounts and at prices that the company deems appropriate, subject to market and business conditions, applicable legal requirements and other considerations. Subsequent to December 31, 2024, we repurchased approximately 105 thousand shares of our common stock for aggregate consideration of $2.0 million.
Our cash flows for the years ended December 31, 2023 and 2022 are presented below (in thousands): Year ended December 31, 2023 2022 Net cash provided by (used in) operating activities $ 8,183 $ (17,054) Net cash provided by (used in) investing activities (6,573) 27,139 Net cash used in financing activities (7,582) (5,076) Effect of exchange rate changes on cash 1,108 (838) Net increase (decrease) in cash, cash equivalents and restricted cash $ (4,864) $ 4,171 Net cash provided by (used in) operating activities Net cash provided by operating activities was $8.2 million for the year ended December 31, 2023 compared to net cash used in $17.1 million for the year ended December 31, 2022.
Our cash flows for the years ended December 31, 2024 and 2023 are presented below (in thousands): Year ended December 31, 2024 2023 Net cash provided by operating activities $ 92,191 $ 8,183 Net cash used in investing activities (137,526) (6,573) Net cash provided by (used in) financing activities 45,242 (7,582) Effect of exchange rate changes on cash (1,411) 1,108 Net decrease in cash, cash equivalents and restricted cash $ (1,504) $ (4,864) Net cash provided by operating activities Net cash provided by operating activities was $92.2 million for the year ended December 31, 2024 compared to net cash provided by operating activities of $8.2 million for the year ended December 31, 2023.
Segment operating income (loss) and segment operating margin percentage Segment operating income for the year ended December 31, 2023 was $23.8 million compared to an income of $9.1 million for the year ended December 31, 2022. For the year ended December 31, 2023, segment operating margin percentage was 3.2% compared to 1.3% for the year ended December 31, 2022.
Segment operating income (loss) and segment operating margin percentage Segment operating income for the year ended December 31, 2024 was $35.7 million compared to $23.8 million for the year ended December 31, 2023. For the year ended December 31, 2024, segment operating margin percentage was 4.4% compared to 3.2% for the year ended December 31, 2023.
Despite these near-term macroeconomic challenges, we expect that the world’s long-term energy demand will continue to rise and may outpace global supply as OPEC+ remains committed to maintaining stable oil prices. We expect that hydrocarbons will continue to play a vital role in meeting the world’s long-term energy needs while renewable energy sources become increasingly prominent.
Although near-term events may present challenges, we expect that the world’s long-term energy demand will continue to rise and may outpace global supply. We expect that hydrocarbons will continue to play a vital role in meeting the world’s long-term energy needs while renewable energy sources become increasingly prominent.
The products and solutions consist primarily of: (i) engineered process systems, production equipment, as well as specialty separation equipment; and (ii) a wide range of industrial valves focused on oil and natural gas as well as power generation, renewable energy and other general industrial applications. 36 Table of Contents Market Conditions Demand for our products and services is directly related to our customers’ capital and operating budgets.
The products and solutions consist primarily of: (i) products designed to safeguard artificial lift equipment and downhole cables; (ii) well construction casing and cementing equipment; (iii) customized downhole technology solutions, providing sand and flow control products for heavy oil applications; (iv) engineered process systems, production equipment, as well as specialty separation equipment; and (v) a wide range of industrial valves focused on oil and natural gas as well as power generation, renewable energy and other general industrial applications. 35 Table of Contents Market Conditions Generally, demand for our products and services is directly related to our customers’ capital and operating budgets.
The products and solutions consist primarily of: (i) capital and consumable products sold to the pressure pumping market, including hydraulic fracturing pumps, cooling systems, high-pressure flexible hoses and flow iron, as well as wireline cable and pressure control equipment used in the well completion and intervention service markets; and (ii) coiled tubing strings and coiled line pipe and related services. • Production .
The products and solutions consist primarily of (i) capital equipment and consumable products used in the drilling process; (ii) capital equipment and aftermarket products including subsea ROVs and trenchers, submarine rescue vehicles, specialty components and tooling, and technical services; (iii) capital equipment and consumable products sold to the pressure pumping market, including hydraulic fracturing pumps, cooling systems, and high-pressure flexible hoses and flow iron; (iv) wireline cable and pressure control equipment used in the well completion and intervention service markets; and (v) coiled tubing strings and pressure control equipment used in coiled tubing operations, as well as coiled line pipe and related services. • Artificial Lift and Downhole .
These items include Transaction expenses, Gain on sale-leaseback transactions and Loss (gain) on disposal of assets and other. For further information related to Gain on sale-leaseback transactions, see Notes 6 Property and Equipment and 9 Leases. Other income and expense Other income and expense includes interest expense and foreign exchange gains and losses.
These items include Transaction expenses, Impairment of intangible assets , Gain on sale-leaseback transactions and Loss on disposal of assets and other. For further information related to Impairment of intangible assets, see Note 7 Goodwill and Intangible Assets. For further information related to Gain on sale-leaseback transactions, see Notes 6 Property and Equipment and 9 Leases.
Off-balance sheet arrangements As of December 31, 2023, we had no off-balance sheet instruments or financial arrangements, other than letters of credit entered into in the ordinary course of business. For additional information, refer to Note 12 Commitments and Contingencies.
Off-balance sheet arrangements As of December 31, 2024, we had no off-balance sheet instruments or financial arrangements, other than letters of credit entered into in the ordinary course of business.
We are continuing to develop products to help oil and gas operators lower expenses, increase production, and reduce their emissions while also deploying our technologies in renewable energy applications. A summary of the products and services offered by each segment is as follows: • Drilling & Downhole .
We are continuing to develop products to help oil and gas operators lower expenses, increase production, and reduce their emissions while also deploying our technologies in renewable energy applications.
The change in operating income (loss) and operating margin percentage for each segment is explained as follows: Drilling & Downhole segment — Segment operating income was $33.8 million, or 10.2%, for the year ended December 31, 2023 compared to segment operating income of $32.2 million, or 10.6%, for the year ended December 31, 2022.
The change in operating income (loss) and operating margin percentage for each segment is explained as follows: Drilling and Completions segment — Segment operating income was $17.8 million, or 3.8%, for the year ended December 31, 2024 compared to $19.4 million, or 3.9%, for the year ended December 31, 2023.
See Note 8 Debt for further details related to the 2025 Notes and Credit Facility. The foreign exchange gains and losses are primarily the result of movements in the British pound, Euro and Canadian dollar relative to the U.S. dollar.
The foreign exchange gains and losses are primarily the result of movements in the British pound, Euro and Canadian dollar relative to the U.S. dollar.
Corporate — Selling, general and administrative expenses for Corporate were $27.3 million for the year ended December 31, 2023, a $7.0 million decrease compared to the year ended December 31, 2022. This decrease was primarily related to lower variable compensation costs.
The $17.3 million increase in segment operating results was primarily driven by the acquisition of Variperm. Corporate — Selling, general and administrative expenses for Corporate were $31.0 million for the year ended December 31, 2024, a $3.7 million increase compared to the year ended December 31, 2023. This increase was primarily related to higher variable compensation costs.
Any changes in our judgment as to the realizability of our deferred tax assets are recorded as an adjustment to the deferred tax asset valuation allowance in the period the change occurs. For the year ended December 31, 2022, we recognized tax expense for valuation allowances totaling $8.1 million.
Any changes in our judgment as to the realizability of our deferred tax assets are recorded as an adjustment to the deferred tax asset valuation allowance in the period the change occurs.
As of December 31, 2023, we had cash and cash equivalents of $46.2 million and $147.1 million of availability under our Credit Facility. Upon closing of the Variperm Acquisition on January 4, 2024, our net availability under our Credit Facility was approximately $73.1 million. We anticipate that our future working capital requirements for our operations will fluctuate directionally with revenues.
As of December 31, 2024, we had cash and cash equivalents of $44.7 million and $61.2 million of availability under our Credit Facility. We anticipate that our future working capital requirements for our operations will fluctuate directionally with revenues.
Offshore Rigs Land 1,566 1,528 Offshore 246 221 Global Active Rigs 1,812 1,749 U.S. Commodity Target Oil 549 574 Gas 135 147 Other 3 2 Total U.S. Active Rigs 687 723 U.S. Well Path Horizontal 620 659 Vertical 17 25 Directional 50 39 Total U.S.
Offshore Rigs Land 1,496 1,566 Offshore 238 246 Global Active Rigs 1,734 1,812 U.S. Commodity Target Oil 491 549 Gas 105 135 Other 3 3 Total U.S. Active Rigs 599 687 U.S. Well Path Horizontal 536 620 Vertical 15 17 Directional 48 50 Total U.S.
The 2025 Notes mature in August 2025 and, subject to certain exceptions, the Credit Facility matures in September 2028. In January 2024, we entered into the Seller Term Loan in connection with the closing of the Variperm Acquisition, which has an initial principal amount of $60.0 million and matures in December 2026.
In January 2024, we entered into the Seller Term Loan in connection with the closing of the Variperm Acquisition, which had an initial principal amount of $60.0 million and a maturity date in December 2026. In June and August 2024, we repurchased and redeemed $13.0 million and $60.0 million in aggregate principal amount of 2025 Notes, respectively.
We expect our available cash on-hand, cash generated by operations, and estimated availability under our Credit Facility to be adequate to fund current operations during the next 12 months.
In addition, we expect total 2025 capital expenditures to be approximately $10.0 million, primarily for replacement of end of life machinery and equipment. 40 Table of Contents We expect our available cash on-hand, cash generated by operations, and estimated availability under the Credit Facility to be adequate to fund current operations during the next 12 months.
The changes in revenues by operating segment consisted of the following: Drilling & Downhole segment — Revenues were $329.6 million for the year ended December 31, 2023, an increase of $25.0 million, or 8.2%, compared to the year ended December 31, 2022.
The changes in revenues by operating segment consisted of the following: Drilling and Completions segment — Revenue was $470.8 million for the year ended December 31, 2024, a decrease of $31.9 million, or 6.3%, compared to the year ended December 31, 2023.
Our revenues, over the long-term, are highly correlated to the global drilling rig count, which increased 3.6% in 2023 compared to average global rig count in 2022. The increase was driven by growth in international rig count in 2023 of 9.6% compared to 2022, while the average U.S. rig count for 2023 was 5.0% lower than 2022.
Our revenues, over the long-term, are highly correlated to the global drilling rig count, which decreased 4.3% in 2024 compared to average global rig count in 2023. The decrease was mainly driven by a decline in U.S. rig count of 12.8%.
Furthermore, availability under our Credit Facility will fluctuate directionally based on the level of our eligible accounts receivable and inventory subject to applicable sublimits. In addition, we expect total 2024 capital expenditures to be approximately $10 million, consisting of, among other items, replacing end of life machinery and equipment.
Furthermore, availability under the Credit Facility will fluctuate directionally based on the level of our eligible accounts receivable and inventory subject to applicable sublimits.
For the year ended December 31, 2023, our Drilling & Downhole segment, Completions segment, and Production segment comprised 44.6%, 35.7% and 19.7% of our total revenues, respectively, compared to 43.5%, 37.7% and 18.8%, respectively, for the year ended December 31, 2022.
For the year ended December 31, 2024, our Drilling and Completions segment and Artificial Lift and Downhole segment comprised of 57.7% and 42.3% of our total revenues, respectively, compared to 68.0% and 32.0%, respectively, for the year ended December 31, 2023.
We also borrowed $90.0 million under the Credit Facility to fund a portion of the purchase price of the Variperm Acquisition. See Notes 8 Debt and 18 Subsequent Events for further details related to the terms for our debt agreements.
In 2024, we borrowed $90.0 million under the Credit Facility to fund a portion of the purchase price of the Variperm Acquisition.
During the year ended December 31, 2023, net working capital cash usage was $21.5 million, primarily attributed to an increase in inventory to meet customer demand, compared to net working capital cash usage of $65.1 million for the year ended December 31, 2022.
During the year ended December 31, 2024, net working capital provided cash of $57.6 million, compared to net working capital cash usage of $21.5 million for the year ended December 31, 2023. This change is primarily due to improved inventory management.
The increase of $12.1 million or 17.3%, was primarily due to the project revenue recognized from our process oil treatment equipment within our Production Equipment product line, and a $2.3 million or 3.7%, increase in sales of our valve products.
Revenue for our Downhole product line increased by $117.0 million, or 129.3%, primarily due to revenue contributed from the acquired Variperm business and an increase in downhole equipment sales. This increase was partially offset by a $5.7 million, or 7.0%, decrease in surface production equipment and a $1.9 million, or 2.9%, decrease in sales of our valve products.
See Note 5 Inventories for further information related to these charges. 44 Table of Contents Long-lived assets As of December 31, 2023, our long-lived assets included property and equipment, definite lived intangibles, and operating lease right of use assets with balances of $61.4 million, $168.0 million and $55.4 million, respectively.
Long-lived assets As of December 31, 2024, our long-lived assets included property and equipment, definite lived intangibles, and operating lease right of use assets with balances of $63.4 million, $109.2 million and $70.4 million, respectively.
Taxes We recorded tax expense of $11.1 million for the year ended December 31, 2023 compared to a tax expense of $6.6 million for the year ended December 31, 2022.
The net carrying value of the extinguished debt, including debt issuance costs, was $59.2 million, resulting in a $0.8 million gain on extinguishment of debt. Taxes We recorded tax expense of $6.9 million for the year ended December 31, 2024 compared to a tax expense of $11.1 million for the year ended December 31, 2023.
Revenues for our Downhole Technologies product line increased by $5.5 million, or 6.4%, primarily due to higher sales volumes of artificial lift products in 2023 compared to 2022. Revenues for our Subsea Technologies product line decreased by $7.7 million, or 10.1%, from lower project revenue recognized from ROVs and cable management systems, partially offset by an increase in part sales.
These decreases were partially offset by a $9.6 million, or 14.1%, increase in our Subsea product line due to higher project revenue recognized from ROVs. Artificial Lift and Downhole segment — Revenue was $345.7 million for the year ended December 31, 2024, an increase of $109.4 million, or 46.3%, compared to the year ended December 31, 2023.
Net cash provided by investing activities for the year ended December 31, 2022 including $32.1 million of cash proceeds from sale of land and buildings that were subsequently leased back, partially offset by $7.5 million of capital expenditures.
Net cash used in investing activities Net cash used in investing activities was $137.5 million for the year ended December 31, 2024, mainly related to the Variperm Acquisition of $150.4 million and capital expenditures of $8.1 million, partially offset by $20.3 million proceeds from sale-leaseback.
Net cash used in financing activities was $5.1 million for the year ended December 31, 2022 including $3.8 million of cash used to repurchase of our common stock and $1.3 million of repayments of debt.
Net cash provided by (used in) financing activities Net cash provided by financing activities was $45.2 million for the year ended December 31, 2024 and included $54.9 million of net proceeds from debt mainly due to Variperm Acquisition, partially offset by $8.5 million of paid financing costs.
Production segment — Segment operating income was $6.5 million, or 4.4%, for the year ended December 31, 2023 compared to segment operating loss of $0.4 million, or 0.3% for the year ended December 31, 2022. The $6.9 million increase in segment operating results was driven by the increase in revenues, lower freight costs, as well as increased operating leverage.
The $1.7 million decrease in segment operating results was primarily due to the overall decline in segment revenues. Artificial Lift and Downhole segment — Segment operating income was $48.9 million, or 14.1%, for the year ended December 31, 2024 compared to $31.6 million, or 13.4%, for the year ended December 31, 2023.
Removed
The products and solutions consist primarily of: (i) capital equipment and consumable products used in the drilling process; (ii) products designed to safeguard artificial lift equipment and cables, and well construction casing and cementing equipment; and (iii) ROVs and trenchers, submarine rescue vehicles, specialty components and tooling, and technical services. • Completions.
Added
In the first quarter 2024, following the Variperm Acquisition, we aligned our reportable segments with business activity drivers, our customer base, and the manner in which management reviews and evaluates operating performance. FET now operates in the following two reportable segments: (1) Drilling and Completions and (2) Artificial Lift and Downhole.
Removed
This segment designs, manufactures and supplies products and solutions to the coiled tubing, well stimulation and intervention markets.
Added
Refer to Note 17 Business Segments for the product lines making up each segment. Our historical results of operations were recast retrospectively to reflect these changes in accordance with U.S. GAAP. A summary of the products and services offered by each segment is as follows: • Drilling and Completions .
Removed
Oil and natural gas prices softened in the first half 2023 as a result of global recessionary fears, but rebounded somewhat during the second half of 2023 as supply tightened from further OPEC+ production cuts and growing geopolitical tensions in the Middle East. These tensions could lead to a disruption to world energy markets and international supply chains.
Added
This decline can be attributed to anticipated increases in production by OPEC+, geopolitical uncertainty in Ukraine and the Middle East and slowing global oil demand growth. In the future, volatile macroeconomic conditions, including potential tariffs imposed by U.S. or foreign governments, could disrupt world energy markets and international supply chains.
Removed
The price of oil has varied dramatically over the last several years. The spot prices for West Texas Intermediate (“WTI”) and United Kingdom Brent (“Brent”) crude oil fell from $61.14 and $67.77 per barrel, respectively, as of December 31, 2019 to lows below $15.00 per barrel in April 2020.
Added
The overall increase in revenue is primarily related to the revenue contributed from the acquired Variperm business, increased revenues in the Subsea product line and increased downhole equipment sales, partially offset by the decline in drilling and completions capital products sales in 2024 compared to 2023.
Removed
Since that time, oil prices rebounded to highs above $120.00 per barrel in March 2022 but have softened in 2023 to an average of $71.89 and $77.69 for WTI and Brent, respectively. In addition, average natural gas prices were 60.8% lower in 2023 compared to 2022.
Added
This decrease includes a $25.3 million, or 15.0%, decrease from the Drilling product line, a $13.4 million, or 8.5%, decrease from Stimulation and Intervention product line and a $2.8 million, or 2.6%, decrease from Coiled Tubing product line, primarily the result of declining U.S. drilling and completions activity.
Removed
The overall increase in revenues is primarily related to increases in the global rig count, with the increase in international rig count more than offsetting a decline in U.S. rig count in 2023 compared to 2022.
Added
Other income and expense Other income and expense includes interest expense, foreign exchange gains (losses) and other, and loss on extinguishment of debt. 39 Table of Contents We incurred $31.5 million of interest expense during the year ended December 31, 2024, an increase of $13.2 million compared to the year ended December 31, 2023 due to the increased borrowings under our revolving Credit Facility and borrowings under the Seller Term Loan entered into in connection with the Variperm Acquisition.
Removed
This increase includes a $27.3 million, or 19.0%, increase in revenues for our Drilling Technologies product line primarily due to higher sales volumes of both consumable products and capital equipment driven by increased international market activity.
Added
See Note 8 Debt for further details related to the Credit Facility, our second lien seller term loan credit agreement that we entered into to fund a portion of the purchase price of the Variperm Acquisition (the “Seller Term Loan”), the 2025 Notes and the 2029 Bonds.
Removed
Completions segment — Revenues were $265.6 million for the year ended December 31, 2023, an increase of $0.7 million, or 0.3%, compared to the year ended December 31, 2022.
Added
During 2024, we redeemed in full the $134.2 million aggregate principal amount outstanding of our 9.00% Senior Convertible Secured Notes due 2025 (“2025 Notes”) at par value, and we discharged our obligations under the indenture governing the 2025 Notes.
Removed
This change includes a revenue increase of $2.0 million, or 1.3%, for our Stimulation and Intervention product line primarily due to higher demand of radiators, wireline cable and high-pressure hoses, partially offset by lower sales volumes in power ends.
Added
The net carrying value of the extinguished debt, including unamortized debt discount and debt issuance costs, was $130.6 million, resulting in a $3.6 million loss on extinguishment of debt. During 2024, we repaid in full our Seller Term Loan at par value.
Removed
Production segment — Revenues were $145.9 million for the year ended December 31, 2023, an increase of $14.3 million, or 10.9%, compared to the year ended December 31, 2022.
Added
In November 2024, we closed $100.0 million aggregate principal amount of 2029 Bonds, the net proceeds of which, together with cash on hand of $10.2 million and borrowings from our Credit Facility of $15.0 million, were used to repay in full the 2025 Notes and the Seller Term Loan.
Removed
The $1.6 million increase in segment operating results was primarily attributable to increased operating leverage on higher revenues for our Drilling Technologies and Downhole Technologies product lines.
Added
The Credit Facility matures on the earliest of (a) September 8, 2028 and (b) the date that is 91 days prior to the maturity of 2029 Bonds (which will not apply if the 2029 Bonds are repaid prior to such 91st day). See Note 8 Debt for further details related to the terms for our debt agreements.
Removed
Completions segment — Segment operating income of $10.8 million, or 4.1%, for the year ended December 31, 2023 was comparable to segment operating income of $11.6 million, or 4.4% for the year ended December 31, 2022. The slight decline in operating income is attributed to unfavorable sales mix.
Added
For additional information, refer to Note 12 Commitments and Contingencies. 41 Table of Contents Critical accounting policies and estimates The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
Removed
We incurred $18.3 million of interest expense during the year ended December 31, 2023, a decrease of $13.2 million compared to the year ended December 31, 2022 due to the decline in the balance of our 2025 Notes upon conversion of $122.8 million aggregate principal amount of our 2025 Notes to common stock in January 2023.
Added
See Note 5 Inventories for further information related to these charges. 42 Table of Contents Business combinations We account for business combinations using the acquisition method of accounting, and accordingly, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition.
Removed
Our ability to make significant acquisitions for cash may require us to pursue additional equity or debt financing, which we may not be able to obtain on terms acceptable to us or at all.

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