Good day, and welcome to Core Laboratories Q3 2019 Earnings Conference Call and Webcast. [Operator Instructions]. Please note, this event is being recorded. I would now like to turn the conference over to David Demshur. Please go ahead.

Thank you, Chris. Good morning in North America, good afternoon in Europe and good evening in Asia Pacific. We'd like to welcome all of our shareholders, analysts and most importantly, our employees to Core Laboratories Third Quarter 2019 Earnings Conference Call. This morning, I'm joined by Chris Hill, Core's CFO; Gwen Schreffler, Core's Head of IR; and Larry Bruno, Core's President and COO. The call will be divided into 5 segments. Gwen will start by making remarks regarding forward-looking statements. We will then review the current macro environment, updating industry trends pertaining to Core Lab's expected future performance, and then some current thoughts on worldwide crude supply trends. We will then review Core's 3 financial tenets, which the company employs to build long-term shareholder value. Chris will then follow with a detailed financial overview and additional comments regarding building shareholder value, followed by Gwen discussing Core's fourth quarter 2019 outlook and a general industry outlook as it pertains to Core's prospects. Larry will then go over Core's 2 operating segments, detailing our progress and discussing the continued successful introduction of new Core Lab technologies and then highlighting some of Core's operations and major projects worldwide, then we'll open the phones to a Q&A session. I'll turn it to Gwen for remarks regarding forward-looking statements. Gwen?

Thank you, Dave. Before we start the conference call this morning, I'll mention that some of the statements that we make during this call may include projections, estimates and other forward-looking information. This will include any discussion of the company's business outlook. These types of forward-looking statements are subject to a number of risks and uncertainties relating to the oil and gas industry, business conditions, international markets, international political climate and other factors including those discussed in our 34 Act filings that may affect our outcome. Should one or more of these risks and uncertainties materialize or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see Item 1A, Risk Factors, in our most recent annual report on Form 10-K as well as other reports and registration -- registration statements filed by us with the SEC and the AFM. Our comments include non-GAAP financial measures, reconciliations to the most directly comparable GAAP financial measures is included in the press release announcing our third quarter results. Those non-GAAP measures can also be found on our website. With that said, I'll pass the discussion back to Dave.

Thanks, Gwen. Now for some industry trends and some comments on our 3 financial tenets. Core is encouraged that operating companies are furthering their commitments to operating within the free cash flow and emphasizing returns on invested capital as demanded by today's investors. This trend benefits Core, whose clients tend to be technologically sophisticated and are heavy users of technology over commodity-driven solutions. During the third quarter, Core continued to host several conference calls and industry sessions for various industry groups and analysts to discuss optimal well spacing, rightsizing, upsizing, well positioning and parent-child well relationships. Proper upsizing and well spacing are 2 of the most discussed topics with Core's clients today. Further up spacing will be seen in 2020. Improving perforating efficiencies and effectiveness rank a close second, which is led to the recent commissioning of Core's cutting edge, Reservoir Optimized Completions Laboratory or ROC Lab and Core's Fit-For-Reservoir strategy for completion. The Fit-For-Reservoir strategy is yielding significant changes in stimulation and completion practices. The industry will continue to add perforating clusters per stage, yielding less but more complex stages, while lateral lengths are near maximum owing to frictional forces. Perf clusters are increasing to as many as 15 to 20 and may be going to 25 per stage, reducing the time and cost for well completions and stimulation programs owing to the lower stage count. The reason for more perf clusters and fewer stages are our clients are changing the way reservoir rock is being stimulated to produce the maximum amount of stimulated reservoir rock volume in close proximity to the wellbore. Long frac channels are to be avoided as they are the source of well interference and child -- parent-child well relationships. It is possible to rebelize more Stimulated Reservoir rock volume in the near-wellbore region and…

Thanks, David. The guidance we gave on our last call and past calls specifically excluded the impact of any FX gains or losses and assumed an effective tax rate of 20%. So accordingly, our discussion today excludes any foreign exchange gain or loss for current and prior periods. Now looking at the income statement. Revenue from continuing operations was a $173.2 million in the third quarter, up 2.5% compared to last quarter, which was driven by higher levels of activity on projects being developed outside the U.S. Of this revenue, service revenue was $120.8 million for the quarter, up over 2% sequentially and reflects the increased activity from international and offshore projects. Product sales, which is more tied to North American activity, were $52.4 million for the quarter, also up over 2% from last quarter. Considering the decline of completion activity for the U.S. onshore market during the third quarter, we are pleased with the performance of our product sales, which was led by our high energetic sales and market penetration of the addressable select firing switch and the GoGun. Moving on, the cost of services for the quarter are 71% of service revenue, down from 73% in the previous quarter as operational efficiencies continued to improve. Cost of sales in the second quarter was 76% of sales revenue, up just slightly from 75% in the previous quarter. G&A for the quarter was approximately $11 million, which is up a little from $10 million last quarter. For 2019, we now expect G&A ex-items to be between $42 million and $43 million for the year. Depreciation and amortization for the quarter was $5.7 million, which is comparable to the last several quarters. For the remainder of 2019, we would expect depreciation expense and capital expenditures to remain at similar levels. EBIT…

Thank you, Chris. During the third quarter of 2019, the balance of supply and demand for the global crude oil market did not materially change. Although, the disruption of supply from Saudi Arabia temporarily adversely impacted production output. While crude oil demand growth has weakened over the past 6 months, crude oil supply growth is predicted to modestly increase from non-OPEC countries, though that growth will likely be offset by declines from OPEC, its aligned countries and more mature hydrocarbon provinces. Core Lab projects global crude oil inventory levels will continue to decline as potential growth in the world's crude oil production essentially is limited to 4 countries. The anticipated decline in the global crude oil inventories is also expected to result in a reduction in days of consumption of crude oil in inventory over the coming months, which should support a higher crude oil price. While market concerns exist regarding the balance of crude oil supply and demand, crude oil production additions are limited on a global basis. As Dave mentioned, Core believes that only the U.S., Norway, Guyana and Brazil can add meaningful crude oil supplies over the next few years. The decline curve is prevailing in the mature crude oil fields internationally suggesting a supply gap over time. The balancing of crude oil supply and demand supports the crude oil price, which underpins the reinvestment and final investment decision in the international crude oilfield project. These international investments are critical as the decline in production from the mature fields continues and new field development is required to replace current supply. These underlying fundamentals for the crude oil markets drive the international activity levels of Core's clients. Therefore, our outlook on international projects remains positive for Core's Reservoir Description segment. Turning to the U.S. While U.S. operators continue…

Thanks, Gwen. First, I'd like to thank our global team of employees for providing innovative solutions, integrity and superior service to our clients. The team's collective dedication to servicing our clients is the foundation of Core Lab's success. Turning first to Reservoir Description. In the third quarter of 2019, Core Lab, under the direction of Santos Limited, continued work on an extensive laboratory program designed to evaluate conventional cores and reservoir fluids from the shallow-water Dorado discovery, located offshore Western Australia. More than 700 feet of conventional core were recovered from this high-quality sandstone reservoir. Core Lab utilized its proprietary CAT scan based Digital Rock Characterization technology to determine lithologic characteristics in the intervals of interest. In addition, the Digital Rock Characterization work enables Santos and Core Lab's technical staff to work quickly to select representative rock samples for advanced geological and petrophysical testing. The ongoing physical measurements that are being conducted on these representative samples are crucial for accurate pay zone modeling, downhole log calculation and reserve calculations. In addition to the reservoir rock characterization programs, subsurface hydrocarbon samples were collected from multiple stratigraphic horizons within the reservoir. Core Lab used its proprietary mercury-free, Pressure-Volume-Temperature or PVT cells to determine the phase behavior relationships of the hydrocarbons under varying conditions. Core Lab is pleased to be playing a role in evaluating one of the largest hydrocarbon discoveries, offshore Western Australia. Also in the third quarter, Core introduced a new technological offering to meet client needs. During the exploration, appraisal and development phases of oil and gas fields, critical early-time geological, petrophysical and reservoir fluids properties data are required to meet these needs. Core Lab has developed several proprietary technologies to measure, integrate and deliver these large complex data sets. Core's non-invasive technologies for reservoir optimization, branded as NITRO, includes…

[Operator Instructions]. Our first question is from Byron Pope of Tudor, Pickering, Holt.

First question just related to Reservoir Description. You all continue to see very healthy international top line growth within that segment and trying to pin you down on 2020. But as you think about your international job board and what you have on tap in terms of rocks and fluids analysis were drawn from international and offshore reservoirs. Could you just qualitatively frame, how you're thinking about the international component of Reservoir Description from a growth perspective?

Yes. Byron, Sure. Our overall project board remains positive, and it's in better shape than it's been since the downturn began. If you look back over the year-to-date, you'll see a 9% growth year-over-year in Reservoir Description. That being said, these projects are largely international. They tend to be large projects, and they can be lumpy quarter-to-quarter but the trend clearly looks favorable for us. We see the next year 2020. We see it in, call it, mid- to high single digits.

Okay. That's helpful. And then my second question just relates to the Q4 guidance. I just want to make share I'm thinking about this the right way. So it sounds like, even though the top line erosion will be more pronounced for Production Enhancement, sounds like there will also be a little bit of that for Reservoir Description. But in the -- the implied margin erosion is a lot less than it was the case in Q4 last year. So is that predominantly a function of the cost control actions that you all have taken? Or is it an element of job mix that plays well? Just again -- just trying to understand the context behind that in Q4 guidance.

Yes. Byron, that's right. They're a combination of those. And permanent reductions that we've made in our cost base as well as looking at Q4 is more of a transitory time period from an activity standpoint. We're going to utilize furloughs for that temporary nature of the reduction in activity for Q4 to Q1.

The next question is from Ian MacPherson of Simmons.

In addition to the cost cuts that you've -- in the furloughs that you're undertaking to stabilize your margins, clearly at a more, I think, defensive level than we, otherwise, would have expected given a 6% to 7% revenue decline in the fourth quarter. Is there anything evolving within your product mix? I mean I'm talking about the switch and the GoGun, specifically, and Production Enhancement that is creating variance in the, sort of, normalized margin within Production Enhancement. And then also as we begin to learn more about the evolving market channels for these integrated guns, we are seeing at least some on the periphery on the wireline side seeking to unbundle and compel operators to purchase integrated gun systems rather than contract them through wireline companies. Are you seeing that in the marketplace? And are you open and agnostic to that? Or do you feel that, that is a disruption in the sales channel for your gun systems that you would resist?

So a couple of -- cover quite a bit of ground in question, I'll try to go through those. The -- there are several new products that are helping support margins in Production Enhancement. So the addressable switch, the preassembled guns and refrac also -- all seeing very nice adoption rates. We're a bit agnostic to whether people are buying components or preassembled guns. We are positioning ourselves to be able to adapt to whatever the client demands are. Also significantly, our preassembled guns use an open architecture structure, which allows clients to match the amount of flexibility at the well site to make, sort of, on the fly real-time decision changes if they want to switch out for a different type of our energetic offerings. So we've gone into this market understanding that the energetics at the end of the day are the bulwark of any perforating project. And that the preassembled gun, while it offers a convenience opportunity for the operators and wireline companies, that's carrier for the important -- the business end, if you will, of the perforating job, which is the energetics.

That's very helpful. And then just with regard to the possibility of wireline companies unbundling your products and pushing operators to self-source. Is that something you've seen or expect to see and have a position on?

Not particularly. I think we among all of the folks in this space have maintained a very nice flexibility in that we have all of the components, and we can assemble all of it together. We've got great connections. We make a value proposition on the quality of our energetics to the operators, and the example that I cited earlier about our refrac program that we did with that large E&P -- independent E&P, that's a great example of how we work closely with the operating companies to identify what specifically they need in terms of performance of energetics, and then we get our really talented ballistics engineers set to work on it and brought a new product to market. That's also very reflective of how Core Lab does nearly all of its R&D., it's client driven solution problem. And so our -- we do deal with the wireline companies. They have a critical role to play in deploying energetics and doing the perf jobs. But a lot of our efforts are -- have always been focused on selling the value of our energetic performance to the E&P companies.

The next question is from Chase Mulvehill of Bank of America.

So I guess, I just want to stick on the energetic side of it. Could you talk a little bit about the competitive environment of energetics and particularly may be the integrated guns, and what you're seeing on the pricing side? And then I also didn't hear whether energetics revenue was actually up in 3Q, I'm assuming it was but I hope you can give us some color there.

Go ahead, Gwen.

Yes. I can give you some color on that, Chase. The U.S. energetics was down slightly about 4.3% year-over-year. And when you compare that to completion activity in the U.S., it compares favorably, completions were down about 10% year-over-year. And then on a sequential basis, it was about 6% sequentially for U.S. energetics in terms of a decline but also compared favorably to the decline of 11% with U.S. completion activity.

Okay. And then what about pricing, is pricing holding up, or is it getting a bit more competitive given the decline in activity?

Pricing is holding up nicely. Because, again, we're targeting the high end -- operators that want to use high-end energetics to communicate with their rock.

Okay. All right. That makes sense. Switching over to Reservoir Description and just trying to connect the dots relative to your consolidated revenue and margin guidance. Could you just hold our hand a little bit and help us understand what's going to happen in the fourth quarter with Reservoir Description relative to top line and margin?

So I think, not really -- we don't give sector guidance specifically, but we do see a strong project board. As I mentioned earlier, it's in the best shape it's been throughout the recovery and looking good. And as I also mentioned earlier, that tends to be -- if you go back and look at Reservoir Description performance through time, you'll see that it, in any part of the cycle, there's a little bit of lumpiness in it because the projects tend to be large, international. We have no control over what happens if a rig has a problem or they have stuck in a hole somewhere. But the trend, if you look at where we've been over the last, say, 12-month cycle year-over-year, Reservoir Description international revenue up 9%. We are seeing, I would say, roughly flat sequentially on Reservoir Description for the fourth quarter.

Okay. And is there an opportunity to take cost out of Reservoir Description as you kind of go into 2020, if it's kind of a mid-single digit growth?

So Chase, we are constantly looking at that. We -- earlier this year, we divested a nonperforming asset that we weren't satisfied with the returns we were getting on it. Also we look at labor, the biggest part of our cost in Reservoir Description. And so, we continue to rollout laboratory automation that helps us to produce more work through the same number of people, and so i think that's another knob that we continue to turn. But across the company, we're continually evaluating all opportunities to run the business as efficiently as possible.

Next question is from Blake Gendron of Wolfe Research.

Just want to touch on Reservoir Description for a bit. One of the driver that we've been focused on is the changing of hands of certain non-core conventional assets from the IOCs to maybe more regional players. I was wondering if this is a driver outside of the normal FID and activity cadence that we track on the Eastern Hemisphere, and may be framed for us what the opportunity is for Core Lab as these assets change hands.

Yes. It actually is good thing for us because they've got to dig in and figure out what they don't know already. So one of the areas that we can leverage is, particularly, on our joint industry project that we own the rights to in those projects multiple companies have given us their rocks and their fluids and their log data and their well information. We consolidate those into databases and interpretive studies. And then when a new entrant comes into the market having just acquired the asset not a company, that new entrant does not get access to the study that may be the original E&P company would have purchased into. So the new investor or the new player in the game would have to come to us to buy that off the shelf. When that happens, that puts some very high margin dollars into our revenue and profit stream.

Is there anyway for you to frame for us what part of the job board right now is related to activity like that?

I don't think we sliced it that way specifically. But we are aware, I'd say it's not a huge one. We're aware of some of these projects that in transition where there's been 1 company that's maybe really good at the exploration side of the business and wants to move on and continue to leverage their particular skill sets on the exploration side, and they'll turn it over to another company that may be is a little better tuned up to the turning of the screws and valves that are required to bring a field on to production. And so we follow that, and we work across both companies to make sure that we stay engaged.

Okay. Great. And then following on Ian's line of questioning. Could you just frame for us what the sales effort or marketing effort is, maybe on the GoGun specifically and then separately for the HEROPerFRAC system going direct E&P versus the wireline company, and if that's changed meaningfully over the last 6 months?

No change. We work across both. The wireline companies are the ones that have the license to hold the energetics. They are sometimes tasked to do a job, and so we sell to them but by and large the predominance of our efforts on sales and marketing are made to the operating companies. We're making a value proposition on the performance of our energetics, and they then go into the wireline companies and direct them to use Core Lab energetic products.

Okay. Perfect. And then last one, you did mention the furloughs and I understand you have to be a little bit sensitive on the messaging here. But you guys obviously, don't operate in the frac crude business and so perhaps, furloughs for you are a little bit different because you're specialized on the labor front. Could you just give us a little bit more color as to how those will look into the fourth quarter? And maybe how you expect to rehire as we head into 2020? Is there any risk, I guess, to perhaps, losing some folks early next year that have been more specialized?

Blake, the answer to the question in terms of retention of folks, that's the beauty of furloughs. Because while you can reduce the number of days in the workweek, thus the number of hours and bring that cost base down, they're still gainfully employed, their benefits are still intact, their vacation, sick leave, those sorts of things still remain intact. And so because Production Enhancement will be the most impacted, that's where we're leveraging the furloughs the most in terms of that segment.

I add to that, Blake, that we've used furloughs before. Gwen has been -- led the program first time we rolled it out a number of years ago. It -- we found it to be a very effective program for both the company and the employees as well as our shareholders. It -- what it allows us to do is navigate through soft patches in the market, employees remain -- maintain their benefits. They are typically on a somewhat reduced work schedule as they are not furloughed completely where they go home and don't have an income coming in. So there'll be a modified work schedule. And very importantly, for Core Lab and very much in our philosophy having been through multiple cycles, it allows us to protect our brain trust, which is the foundation of our business and of any technologically driven business.

The next question is from Sean Meakim of JPMorgan.

On Production Enhancement, you mentioned that you're agnostic at components versus integrated systems. And your systems have open architecture but I think most or all of your competitors have the closed systems. So to what extent does that make it harder for you to take back market share going forward as some wireline providers now offer their own closed integrated systems, and maybe have more incentive to try to push their own systems when they did historically. So does that dynamic of closed architecture among your peers reduce your total addressable market in any way versus prior?

Sean, I think the best perspective on that is that there are number of wireline companies, some big brand names that we're all familiar with, that have always been in the business of making their own energetics, and we've had no problem penetrating into that market space. In fact, you'll see some of those name, brand, wireline companies on our client list, specifically, because the E&P companies have instructed them go get Core Lab energetics, I want that performance.

But prior to this move towards integrated system, you were trying to get out of the gun business, which was -- you just commoditized. And so those guns were being provided by someone else. And now perhaps, some of those guns provide are excited to be selling more integrated systems. Do you view that as a different dynamic? Is it not a different dynamic than previously where you were focused on solely selling energetics? And now you're, due to shift in customer demand, having to focus more on these integrated systems?

Sean, this is Chris. I think when you think about it, it's -- yes, the market was more componentized. So folks that were making only guns didn't necessarily have the new electronic addressable switch or even the energetics in a lot of cases. So it is a shift. But for us, like you said, and which is correct, we had been getting out of the gun-making market, especially when it was still componentized and those were more commoditized. Now that it's an integrated system, I think you have to think of it as a package, which does have components within that, the superior energetics this new addressable firing switch, that makes it a more attractive product for us to get into and go after. And if our customers buy these superior energetics from us, they see the value proposition. If they want an integrated gun system, we want to be able to offer that.

Okay. Just to follow-up on the R&D 2020 discussion. It sounds like given the rig count improvement offshore this year, you feel confident that you're going to get high revenue next year for the segment. But as we're where thinking about magnitude, is it fair to say that the overall expectation is going to be somewhat tempered by the 20% or so that's North America levered? And so is that may be shaving off a few hundred basis points on the overall growth expectation versus what you'd expect for just the international offshore piece?

Yes. A couple of things on that. Maybe I'll give you a little color. One is that the Core Lab's R&D involvement in these projects tends to be a little later cycle than some of the other service companies that are focused on hardware, getting rigs in place, things like that. That has to all happen before Core Lab gets their turn at the plate before rock and fluid samples are taken, find their way into the lab, announcements are done and results are delivered. So we tend to be a little bit later in the cycle than some of the other companies. I do think that there are, call it, potential headwinds on the North America side that are inevitable and unavoidable. And so we are preparing our market for -- or our business for a market that includes that uncertainty.

The next question is from Scott Gruber of Citi.

Question for Chris, working capital was a drag in the quarters, as you highlighted. Sounds like there will be a release in 4Q. How should we think about the size of that potential working capital benefit or where you can take days if that's easier?

Yes. Scott, that is correct. I think what you saw in Q3, some of that we spoke to, which is we are building inventory around some of these new product offerings in the Production Enhancement segment. So there is a natural build, they're just -- it's going to be a little bit higher than we've traditionally carried as the expansion of products. But some of that is also a little seasonal. You'll see some bumps from 1 quarter to another due to bulk purchases of raw material, so that also impacted Q3. When you think about how that looks going into Q4, what I would do is model what we're looking at for revenue and then keep a consistent day sales for the receivables but I would expect some improvement in the inventory. So we are targeting and our guys are targeting to reduce inventory from where it is currently. So you should see a nice pick up from working capital in cash flow in Q4.

Got it. And then Dave or Larry, as we think about well spacing, parent-child effects, it seems that your focus is around these trends positively impacting energetics and intensity is playing out. Can you also provide some color on the benefit you're seeing on the diagnostic service side? It seems like tracer services were a driver supporting Production Enhancement during the quarter. What are you seeing in terms of the demand from E&Ps for diagnostic services given the focal point on spacing, parent-child, et cetera?

Yes. So two things on that. One is, I think the -- maybe -- sort of high-level, early-on misconception that they could come up with a specific footage optimum well spacing. I think that's -- people are broadly aware that's not going to happen now. And we've been aware of it for quite some time and our completion diagnostics are that, sort of, that thermometer, if you will, or that analytical device that allows the -- an operator to say for a given rock -- set of rock properties in a different -- in the specific set of reservoir conditions. So pressure, rock hardness, how brittle the rock is and then dialing in also the size of the frac, the intensity of the frac. What makes sense for that particular area around that well and the diagnostics all the way to validate if you've created well interference between the two. So I think the opportunity for more clients to adopt a measured approach using diagnostics bodes well for us. Secondly, more to come on this pretty soon. We're going to engage -- we're engaged with a number of companies right now, looking at taking a, sort of, multi-company approach to validating a process for finding out optimum well spacing. One other point here on diagnostics, and that is don't forget, just like the example I gave earlier today, diagnostics also have a role to play in completion in conventional reservoirs, particularly, some nice jobs for us in offshore like the one that I described earlier today for LLOG Exploration where there was a big decisions on frac packing had to be addressed. So we do get to play in that arena too. And if that picks up both domestically and internationally there is opportunities for the tracer side of our Production Enhancement business.

Any color on the international side of the Production Enhancement growth currently and how you see that going forward?

I think in-line with the overall numbers we put out before. We've seen improvement year-over-year and I think we'll stick with the, sort of, the mid- to upper single-digits projection for next year.

Chris, will take one more call.

Last question is from Vaibhav Vaishnav of Scotia Howard Weil.

It's Emily on the line for Vebs. So I'm wondering if you could just help us quickly think about the impact of the divestment you did in Apache last quarter. If I remember correctly it was done in June. So you had a $2 million revenue impact for the quarter for 2Q. And then if I think about 2 more incremental months of impact in 3Q, would you say, it had like a $3 million, $4 million revenue headwind in the Reservoir Description for the quarter? And then if I could add to that, if you could give some color more generally on what's keeping decremental for the segment at such low levels that would be helpful as well.

This is Chris. So with regards to the divestiture that you mentioned, yes, that was done about mid-second quarter and we did highlight that. So that was -- if you're trying to compare year-over-year, you do have to subtract out some revenue. That was probably in between $1.5 million to $2 million for Q2 and probably around $3 million, if you wanted to try to forecast that going forward on a quarter basis, so that did happen. That is a little -- if you're trying to look at top line year-over-year that is bit of a headwind, I guess or detracts from some of the growth that's in those businesses. And Gwen, did do want to talk about some of the guidance?

Yes. So on the guidance, we estimated about 30% decremental margin on a sequential basis. And to manage that of course on the more permanent side we've been taking permanent cost out of the cost base since last quarter. And then we'll use furloughs to manage the cost base through Q4 because we think that's temporary in nature, and it gives us the benefit of retaining our talent.

Okay, Chris. So we're going to close now. In summary, Core's operations continued to position the company for activity levels in the fourth quarter of 2019. And we know significant challenges await. However, we have never been better operationally or technologically positioned. To help our clients to maintain and expand their existing production base. We remain uniquely focused and are the most technologically-advanced reservoir optimization company in the oilfield services sector. This positions Core well for the challenges ahead. The company remains committed to the industry-leading levels of free cash generation and returns on invested capital with capital being returned to our shareholders via dividends and future opportunistic share repurchases as free cash flow levels expand. So in closing our 97th quarterly earnings release, we wish to thank all of our shareholders and the analysts that follow Core and as already noted by Larry Bruno, the executive management of Core and our Board of Directors give a special thanks to our worldwide employees that have made these results possible. We are proud to be associated with their continued achievements. So thanks for spending some time with us this morning, and we look forward to talking to you with our next update. Goodbye for now.

Thanks very much, sir. Ladies and gentlemen, it concludes this conference call, and you may now disconnect your lines.