Welcome to the Oil States International Inc Fourth Quarter 2021 Earnings Call. My name is Hilda, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. And later we will conduct a question and answer session. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to Megan Messer. Ms. Messer, you may begin.

Thank you, Hilda. Good morning, and welcome to Oil States' fourth quarter 2021 earnings conference call. Our call today will be led by our President and CEO, Cindy Taylor; and Lloyd Hajdik, Oil States' Executive Vice President and Chief Financial Officer. Before we begin, we would like to caution listeners regarding forward-looking statements. To the extent that our remarks today contain information on historical information, please note that we are relying on the safe harbor protections afforded by Federal Law. No one should assume that these forward-looking statements remain valid later in the quarter or beyond. Any such remarks should be made in the context of the many factors that affect our business, including those risks disclosed in our Form 10-K along with other SEC filings. This call is being webcast and can be accessed at Oil States' website. A replay of this conference call will be available 1.5 hours after the completion of this call and will be available for one month. I will now turn the call over to Cindy.

Thank you, Megan. Good morning, and thank you for joining our conference call, where we will discuss our fourth quarter 2021 earnings and provide our thoughts on the market outlook. During the fourth quarter of 2021, the company generated revenues of $161 million and adjusted consolidated EBITDA of $13.4 million representing sequential increases of 15% and 57%, respectively, despite global challenges associated with the COVID-19 pandemic, supply chain disruptions and a modest seasonal decline in U.S. customer completion activity. Fortunately, the illnesses associated with the latest variant of COVID-19 have been relatively mild and of shorter duration. We expect less impact from COVID-19 as we progress into 2022. Highlighting our fourth quarter was a 34% sequential increase in our Offshore/Manufactured Products segment revenues, coupled with another quarter of strong orders booked into backlog yielding a 1.1 times book-to-bill ratio for the period and a full year ratio of 1.2 times. Expanding global economic activity and increasing backlog levels support a stronger outlook for this segment going into 2022. During the fourth quarter of 2021, the industry experienced a 9% sequential quarterly increase in the average U.S. frac spread count compared to the same period in 2020, the average U.S. frac spread count has doubled. Increases in completion activity have favorably impacted all of our segments. Completion activity in the U.S. shale basins continues to increase and the outlook for 2022 looks constructive for continued growth and demand for our products and services. Lloyd will now review our consolidated results of operations and financial position in more detail before I go into a discussion of each of our segments.

Thanks, Cindy. Good morning, everyone. During the fourth quarter, we generated revenues of $161 million adjusted consolidated EBITDA of $13.4 million and a net loss of $19.9 million or $0.33 per share. These quarterly results were burdened by a $9.3 million reclassification of unrealized foreign currency translation adjustments and $2.2 million of noncash inventory and fixed asset impairment charges due to the decision to exit certain nonperforming regions and service lines. In addition, we recorded $0.8 million or $800,000 of severance and restructuring charges in the quarter. Excluding these charges, our adjusted net loss was $0.14 per share. We ended the year with $53 million of cash on hand compared to $68 million at the end of the third quarter. The quarterly decrease in cash was attributable to a $24 million build in working capital, essentially all of which related to trade receivables associated with the sequential increase in revenues in our Offshore/Manufactured Products segment. As of December 31, no borrowings were outstanding under our asset-based revolving credit facility and amounts available to be drawn totaled $49 million, which, together with cash on hand, resulting in available liquidity of $102 million. At December 31, our net debt totaled $126 million, yielding a net debt to capitalization ratio of 15%. We spent $6.5 million in CapEx during the fourth quarter, which was substantially offset by proceeds received from the sale of assets totaling $5.4 million. In 2022, we expect to invest approximately $25 million to support the expected market expansion. For the fourth quarter, our net interest expense totaled $2.6 million, of which $0.5 million was noncash amortization of debt issuance costs. Our cash interest expense, as a percentage of average total debt outstanding, was approximately 5% in the fourth quarter. Fourth quarter corporate expenses were lower than I previously guided to due to certain adjustments for employee benefits and incentive accruals. In terms of our first quarter 2022 consolidated guidance, we expect depreciation and amortization expense to total $18.2 million, net interest expense to total $2.7 million and our corporate expenses are projected to total $9.3 million. At this time, I would like to turn the call back over to Cindy, who will take you through the operating results for each of our business segments.

Thanks, Lloyd. Our Offshore/Manufactured Products segment reported revenues of $92 million and adjusted segment EBITDA of $13.7 million in the fourth quarter of 2021 compared to revenues of $69 million and adjusted segment EBITDA of $8.6 million reported in the third quarter of 2021. Segment revenues increased 34% sequentially, driven primarily by increases in project-driven and service revenues of 72% and 17%, respectively. Adjusted segment EBITDA margin in the fourth quarter of 2021 was 15% compared to 12% in the third quarter of 2021. Backlog totaled $260 million as of year-end, a 4% sequential increase culminating in our highest backlog level achieved since the first quarter of 2020. Fourth quarter 2021 bookings totaled $105 million yielding a quarterly book-to-bill ratio of 1.1 times and a year-to-date ratio of 1.2 times. During the fourth quarter, we booked one notable project award exceeding $10 million. Our fourth quarter bookings were broad-based across many product lines and regions. Approximately 11% of our fourth quarter bookings were tied to non-oil and gas projects, bringing our full year non-oil and gas bookings to 10%. During the fourth quarter, we completed several strategic milestones, including the successful installation of riser equipment on a major project in South America; qualification of a new subsea tree connector with significant market opportunities on upcoming Brazilian projects; received a third-party certification on our new condition-based monitoring program for marine drilling riser systems; and the securing of our third rental contract for a newly sized proprietary Merlin high-pressure drilling riser to a customer in the Middle East. For nearly 80 years, our Offshore/Manufactured Products segment has endeavored to develop leading-edge technologies, while cultivating the specific expertise required for working in highly technical deepwater and offshore environments. As the world expands investment in alternative energy sources, we will be working diligently to…

Hilda, it sounds like there may not be any questions today? I'll just wrap up and say thank you all for calling in today to join our call. I know it's a very busy period for each of you. We do look forward to visiting with you in future quarters and what looks to be a more favorable market in 2022. Thanks so much.

Thank you. Ladies and gentlemen, this concludes today's conference. We thank you for participating. You may now disconnect.