Good day, ladies and gentlemen. And welcome to the NOV First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce you to your host for today’s conference, Mr. Blake McCarthy, Vice President of Corporate Development and Investor Relations. Sir, you may begin.

Welcome, everyone, to NOV’s first quarter 2023 earnings conference call. With me today are Clay Williams, our Chairman, President and CEO; and Jose Bayardo, our Senior Vice President and CFO. Before we begin, I would like to remind you that some of today’s comments are forward-looking statements within the meaning of the federal securities laws. They involve risks and uncertainty, and actual results may differ materially. No one should assume these forward-looking statements remain valid later in the quarter or later in the year. For a more detailed discussion of the major risk factors affecting our business, please refer to our latest forms 10-K and 10-Q filed with the Securities and Exchange Commission. Our comments also include non-GAAP measures. Reconciliations to the nearest corresponding GAAP measures are in our earnings release available on our website. On a U.S. GAAP basis, for the first quarter of 2023, NOV reported revenues of $1.96 billion and net income of $126 million or $0.32 per fully diluted share. Our use of the term EBITDA throughout this morning’s call corresponds with the term adjusted EBITDA as defined in our earnings release. Later in the call, we will host a question-and-answer session. Please limit yourself to one question and one follow-up to permit more participation. Now let me turn the call over to Clay.

Thanks, Blake. For the first quarter of 2023, NOV reported revenue of $1.96 billion, down 5% sequentially on seasonality and project timing and up 27% compared to the first quarter of 2022. The company posted fully diluted earnings of $0.32 per share for the first quarter, up $0.45 year-over-year. EBITDA was $195 million or 9.9% of revenue, up $92 million year-over-year. Demand remained strong, our consolidated orders exceeded revenue out of backlog for the eighth consecutive quarter, yielding a book-to-bill of 109%. For most of our business units, it was a good quarter, but overall, EBITDA came in softer than we expected due to a couple of discrete charges when related to an environmental accrual top-up and another related to litigation, along with a significant supply chain issue we encountered in our drill pipe business. This led to an EBITDA shortfall and a significant build in inventory for the Wellbore Technologies segment. Revenues and EBITDA for our other two segments, Rig Technologies and Completion & Production Solutions, were generally in line with our expectations for the quarter. Unplanned events at one of our vendor steel mills within the past few months led to a lack of raw materials for drill pipe, specifically bar stock for tool joint material, which goes into the connections at each end of every joint. Lack of raw materials disrupted our production schedules and impacted our manufacturing efficiency. As we were required to double the number of production line setups, we typically perform each quarter in order to conform our manufacturing schedule to the materials we had on hand. Consequently, we lost valuable manufacturing time and faced higher costs as we scramble to secure more expensive supplies from alternative vendors, which led to far fewer shipments and a roughly $10 million EBITDA shortfall versus our earlier…

Thank you, Clay. EBITDA in the first quarter of 2023 totaled $195 million or 9.9% of sales, a decrease of $36 million sequentially and an increase of $92 million year-over-year. EBITDA was negatively impacted by supply chain issues and related operational disruptions in our drill pipe business that Clay described, as well as $8 million in charges related to environmental reserves and legal expenses. Cash flow used by operations was $202 million during the first quarter, driven primarily by ordinary Q1 payments associated with and reflected in our accrued liabilities, as well as a sizable increase in inventory. While Clay spoke earlier of the inventory challenges we faced during the first quarter, I think, it’s worth recounting why this was such a significant use of cash during the period. First, in several of our businesses, the limited availability and uncertainty around deliveries of certain raw materials and components prevent us from completing the manufacturing of products in a methodical and efficiently planned process. We are having to set uncompleted products to the side while we await missing materials to finish the project, resulting in excessive levels of work in process or WIP and assemblies in our inventories. Second, we continue working to build buffers of critical materials and components in order to avoid the WIP build situation I just described. Third, while we are still experiencing significant delays of a limited number of materials, the broader global supply chain is healing at an accelerating rate, resulting in certain materials arriving faster and greater quantities than expected, including items for which we had been on limited allocations. Lastly, we are continuing to see growing demand for our products and services and our operations are gearing up for meaningful growth through the back half of the year. The total effect of all…

Okay. Thank you. [Operator Instructions] And our first question comes from Jim Rollyson with Raymond James. Jim, your line is open. Please go ahead.

Hey. Good morning, guys. How are you today?

Good morning, Jim.

Hi, Jim.

Clay, a lot of talk by yourselves and some of the other large players just around improvements and kind of the outlook for international and offshore, which obviously bodes well for you over time. But curious when you break down kind of what you are seeing between -- you have talked about FPSO demand and your role there, obviously, rig reactivations and the fact that, you guys have talked about getting deeper in the weeds and the incremental capital dollars that are required there. Just as you kind of frame out how to think about where are the greatest lots of opportunity as this unfolds over the next several quarters for NOV?

Thanks, Jim. All three of our segments participate in the offshore, and I think it’s fair to say for all three segments as well as our peers in oilfield services, the offshore generally is a higher calorie sort of environment. And so I think why there’s so much enthusiasm across oilfield services with respect to the offshore coming back is the fact that it’s been largely absent since 2014. And so just to run it down, obviously, Rig Technologies as the leading OEM provider of equipment that’s seen on almost all the offshore rig fleet, as those rigs go back to work, we are the kind of the first call, drilling contractors make when it comes to reactivating their rigs to upgrading their rigs, which is why we are seeing rising demand for activity in shipyards around the world. I think I mentioned in my prepared remarks that re-certifications of rigs, special purpose surveys, upgrades and reactivations, we now have 55 projects underway in shipyards to support that effort, along with kind of the day-to-day aftermarket spare parts. And what we are particularly excited about is the adoption of technologies we developed for both land and offshore, but in the offshore and mentioned ExxonMobil standardization on their offshore fleet for the Guyana development. In Completion & Production Solutions, it’s a little more downstream and so the excitement there is really focused on FPSOs. We have a number of conversations underway with producers around our gas processing technology, our swivel turret monitoring systems for FPSOs, lots of areas in that world that we are market leader and then, finally, on Wellbore Technology. As these rigs actually do go back to work, they operate at very high day rates and so efficiency matters a lot. There’s a tremendous amount of focus on efficient wellbore construction operations and I am excited about the technologies that we have in digitally monitoring and optimizing those operations and the impact we are going to have as the rig count gets back to work. So haven’t -- if you look at the offshore rig count, the rigs actually turning to the right, we are still not back to where we were in the first quarter 2020, but it’s clear to all of us in the space that the puck is going in the right direction. There’s been a lot of E&P conversations around FIDs on developments that have been -- we have all been working on for the past several years that are now finally starting to move forward and excited about the impact on our business.

Thanks. That’s very helpful. And then just for one follow-up. On the Well Tech -- Wellbore Tech side, obviously, you had some issues this quarter. It seems like the charges were kind of one-off deals. Hopefully, the steel supplier issues, you mentioned getting better in second quarter and should be fully resolved by the third quarter. When we think about the margin progression, obviously, you mentioned what second quarter looks like. But how quickly does Wellbore Tech get back to, because it sounds like everything else outside of that was actually performing quite well, plus or minus the seasonality. So just trying to understand how I think about margin progression there, getting back to where we were in 4Q and then beyond?

It is. As we mentioned, we are going to have a little bit of our drill pipe problems drift over into Q2, but we are pretty confident by Q3 that’s behind us. And so, when we get past -- when we get to the end of the year, I think, we are going to have margins in that segment that start with two and feel pretty good about that outlook, Jim. It’s just -- you can tell from our prepared remarks and our results, it’s frustrating to continue to have to battle through supply chain challenges and I will credit that team for the yeoman’s work that they did in the first quarter to overcome a pretty extraordinary disruption in a critical component that goes into drill pipe and they are very fully engaged on getting it fixed and behind us, and we are confident we will.

Great. Thanks for the answers.

Thanks, Jim.

Okay. Standby while I bring the next caller. And the next question comes from Luke Lemoine with Piper Sandler. Luke, your line is open now. Please go ahead.

Hey. Good morning.

Good morning, Luke.

Hi, Luke.

Clay, your Rig Tech orders have kicked up nicely from year ago levels, been stabilized at a higher level kind of in the mid-$200 million range the last couple of quarters.

Yeah.

Do you think there’s now a base you can kind of build-up on and then could you talk about the margin profile of the backlog Rig Tech relative to your current Rig Tech margins?

Yeah. Yeah. We were pleased to see strong 140% book-to-bill in Q1 for Rig Technology. Jose mentioned, we had a pretty sizable wind turbine order in that, but we have had pretty much one of those -- one or two quarters, we haven’t had one, but that’s been a pretty nice, steady piece of workforce. And then in addition to that, I think, Jose also mentioned, we had a rig reactivation capital equipment order embedded in there as well and that -- for that particular rig, it was, call it, in very rough numbers in the $50 million range. Yeah, we are hopeful that, that we can kind of continue and that this is sort of a new base level, and as we also said in our prepared remarks, our expectation is that rigs are going to get more expensive to reactivate, and we are hopeful that they will also carry more upgrade equipment and replacement equipment as we get deeper into the stack. And so, but I would just point out, as you know, orders are always lumpy and there’s ups and downs and rig certainly benefited from this higher level of sustained demand in the first quarter, but orders are always going to be a little bit volatile for us and completion and production solutions. And so, but on the whole, I think, the level of enthusiasm across the oil and gas space is underpinning a pretty strong and robust outlook for demand for what we make.

Okay. Got it. And then maybe just kind of on the margins in the backlogs…

Oh! Sorry.

…and just directionally or magnitude?

Yeah. Thank you. Sorry. The second part of your question was margin improvement, and what I am most optimistic about there, frankly, is the sort of evaporation of all of the supply chain challenges that Rig Technology has been dealing with for these past couple of years as well. We have -- our number one mission is to make sure that we deliver the spare parts and the consumables that our drilling contractor customers need to execute and they keep their rigs working. And so we in that group, too, have been doing yeoman’s work and moving heaven and earth to make sure our customers have what they need and that’s been a headwind in that business. And we were pleased in the fourth quarter to see in particular more castings and forgings available from foundries that support our operation and a step up in shipments and then even more shipments in the first quarter. So for instance, record shipments of some trifocal pumps. And so it’s kind of the supply chain issues abate, I think, that can kind of give rise to stronger margins in Rig Technologies. But we think that, that business, as we kind of look to the end of the year, we ought to see its EBITDA margins get up into kind of the low- to mid-teens range, let’s say.

And so, Luke, I’d add, so specifically related to the backlog, the pricing and the composition of the backlog within rig is quite good. That’s probably even more of a volume issue and some of the other external factors. So here as we have now had four straight quarters in a row of improving bookings specifically related to rig equipment, we feel much better about the absorption of our facilities. And as Clay mentioned, the return to normalization of the supply chain should allow much better margins for Rig Technologies overall.

Okay. Great. Thanks, Clay. Thanks, Jose.

You bet. Thanks, Luke.

And our next question comes from Neil Mehta with Goldman Sachs. Neil, your line is open. Please go ahead.

Good morning, team, and thanks for all the color. The first question is a follow-up to last quarter around free cash flow and I thought it was interesting that, Jose, you made the comment that you expected $100 million to $300 million of positive free cash flow this year, is that right? And given the burn in the first quarter, which I recognize is seasonally weak, maybe you could talk about the cadence of some of the drivers that give you confidence that could flip to positive?

Yeah. Sure, Neil. First of all to address the guide on that, yes, it was between $103 million of free cash flow.

$100 million.

I am sorry, $100 million to $300 million free cash flow for the full year. So more than offsetting the $256 million of free cash flow -- of negative free cash flow in the first quarter. So, yes, as you pointed out, Q1 is always seasonally a very difficult free cash flow quarter and we had expectations that we would have a material consumption of cash in the first quarter of this year related to that seasonality, as well as what we had seen coming from a need to sort of continue building buffers in our inventory and to prepare for what was looking to be a really good year in 2023, particularly as we get back to the back half year. So all of that occurred as expected, plus the laundry list, the four different items I mentioned in my prepared remarks related to supply chain challenges and accelerated recovery of the supply chain, which led to about $65 million more of inventory than what we were expecting three months ago. So looking at the next three quarters of the year, there are always a lot of puts and takes one quarter to the next. The timing of a payment from a customer, a single payment could be plus or minus $50 million and depending on where it hits one quarter to the next is going to make a pretty material swing. So I am not going to give precise guidance for every quarter. But really, if you sort of look at the math on how we get to that free cash flow guidance, what we are looking at is, working capital metrics at the end of this year, and when I said working capital metric, call it, working capital as a percentage of revenue run rate, is really 200 basis points to 300 basis points higher than where we exited last year gets us within the range of that guidance. So these are not Herculean-type assumptions that are built into our expectations for free cash flow. And typically, what happens is Q2 is a slightly positive free cash flow quarter and it improves in the final two quarters of the year. So that’s kind of what my expectations are.

And how much visibility do you have into that back half inflection at this point in the year, given you are a long cycle business? Is it fair to say it’s something where you have a high degree of confidence interval and to the extent that there would be a downward surprise to that sharp improvement in free cash flow, what is the biggest risk to it?

Luke, we feel pretty good about the outlook in the second half of the year and within that outlook is baked in some softness within the North American marketplace. And so really the -- I see the bigger risk on the free cash flow really relates to a higher exit rate than what we have dialed in and that’s certainly a possibility. And as I have always said, I would gladly take a higher growth rate and less near-term cash flow to have that higher growth rate that ultimately translates into higher free cash flow down the road.

Yeah.

Neil, as you know, the business model of providing capital equipment to the oilfield can be pretty. There’s a lot of optionality and can be a lot of pretty explosive growth in that model. And if you look back to the prior super cycle, our topline grew almost seven-fold between 2004 and 2014. And so to Jose’s point, a lot more revenue is a possibility and would require more investments and inventory and working capital to support, but not a bad problem to have.

Yeah. Those are good problem. Thanks so much, team.

You bet.

Thanks, Neil.

Eric, are you there?

Eric’s speaker on mute.

Eric, we are ready for the next…

Yes. I am so sorry. Yes. I have brought Stephen Gengaro from Stifel. Your line is open. Please go ahead.

Thanks. Good morning, gentlemen.

Good morning, Stephen.

Two for me. I think, first, we have heard a lot from some of the U.S. pressure pumpers about kind of upgrading assets and really seeing a bifurcation in the market for electric fleets. And I am just curious what you are seeing on that end and how you think about that business potentially picking up over the next several quarters as companies start to see the benefits and probably kind of go get in line for new equipment?

Yeah. Stephen, I will start off on that one. So, yeah, I mean, right now the dialogue with our customers for pressure pumping equipment in the North American marketplace remains very positive, very, very constructive. As I mentioned in my prepared remarks, there were some conversations that we are having last quarter with customers about potentially adding what would have been net expansion fleets. Those specific conversations, which were a very limited number of conversations have died off. But I’d say the conversation related to the need to replace and upgrade existing fleets is every bit as strong as it was last quarter, if not stronger. So I think people are really, one, the asset base is tired. It’s been run extremely hard, but maybe even more importantly, to your point, we are seeing more customers really acknowledge that bifurcation that you touched on in terms of the reliability, the quality and the total cost of ownership associated with either state-of-the-art dual fuel or e-fleets. So we expect demand to remain pretty resilient going forward. Plus, honestly, we are also seeing good demand coming from wireline equipment and pressure control equipment, both domestically as well as in international markets. So feel pretty good about the footing of our Intervention and Stimulation Equipment operations.

Yeah. We hear anecdotally that the pressure pumpers customers, the producers are pressing the pressure pumpers to have a plan to reduce emissions and natural gas and electrification is generating a lot of interest around that question. The other data point, I don’t know this in our prepared remarks, but I think our quotations in our business unit were up 30% or 35% sequentially in that area. So a lot of good conversations around the need for Stimulation Equipment.

Great. Thanks. That’s great detail. One quick one on the Rig Tech side, when we think about the order flow you are seeing and sort of the revenue out of backlog numbers as the next several quarters unfold. Is there an inflection point we should be thinking about as far as revenue out of backlog or is it a pretty smooth likely gradually move higher over the next several quarters?

Yeah. Stephen, the expectation is it’s more of a smooth progression over the next several quarters.

Okay. Great. Thank you.

Yeah. Thanks, Stephen.

And I am just bringing the next caller forward, Kurt Hallead with Benchmark has the next question. Kurt, your line is open. Go right ahead.

Great. Thank you. Hey. Good morning, guys.

Good morning, Kurt.

As always good color. Always appreciate it. So, yeah, my initial question here is also on Rig Tech and as you referenced number of potential deepwater rig activation potentially coming over the course of the next 12 months or so to satisfy the incremental demand. Based on the data, I think, I have seen, there is about 14 deepwater rigs that likely to upgraded -- that could be upgraded within 12-month period with cost range anywhere between $70 million to $100 million. You have already given some indication that on a rig activation order you booked in the quarter that had about a $50 million ticket size to it. So I guess that answers the question that I had, but is that kind of on average would you or we would expect to be able to get from the rig activation?

Well, I’d be -- I am going to caution us all that you are kind of asking how long is a piece of rope, every rig is different and the capabilities of a rig required for a particular drilling program are going to vary by operator. And frankly, nobody is going to mood to spend capital that they don’t have to spend and so what I would tell you it’s hard to give you a clean average it’s going to apply to all of those rigs, they all need the different, well, first of all, we have got a engineers in there on the deck and look around and see what remains to be done. But the general trend and this is the picture we were trying to paint in our remarks is that, as you get deeper into the stack, the rigs are the cheapest and easiest to get reactivated first, get reactivated first. We are getting deeper into the stack and it’s going to take more -- increasingly more work and so I am hesitant to generalize and it’s a pretty wide bracket of cost. But on that notwithstanding, yeah, in the market that today has about 80 drill ship drilling, there is about 14 that could, paying how much money they have could be put back into that marketplace. I think there was another four being constructed and that were suspended in those construction activities could pick and shipyard get back to completing those rigs and putting them into the marketplace and then after that, I think, you are going to have to -- you would be looking building your rigs and so that’s kind of the extent of capacity that’s out there.

Yeah. Got it. Yeah. Great. Thanks. One follow-up, so you guys referenced that, your current EBITDA margins for each of your segments are below what you could see be normalized. So could you give us a refresher on what you consider to be normalized margins for each of those businesses and I probably would then just kind of see if you can give us a perspective as to given the visibility you have, Clay, on how things are unfolding as normalized margin, the prospect for 2024, is it going to maybe take a little bit longer to get there?

Yeah. I would tell you, I am going to give you a consolidated answer rather than go segment-by-segment, but mid-cycle margins here ought to be mid-teens in my view and 9.9% is disappointing. We were knocking on the door in 2018, 2019, and I think, we need to see -- the supply chain issues get behind us, we need to continue to push price. We need to burn off some lower margin backlog and that’s the path to get us back to acceptable margins, which is where we ought to be now. And then if you kind of extend the story and you go back to the last super cycle, as we get past the mid-cycle and things really get a little more heated up, margins that start with the two are a possibility. And so that’s really what we are targeting and we are working on improving the margins in all three of our segments and using all the levers we have from improved operational management, along with price increases and that’s what the goal is.

Okay. Great. Thanks. Appreciate the color.

You bet.

Okay. Standby for our next caller. It is Marc Bianchi with TD Cowen. Marc, your line is open. Please go ahead.

Hey. Great. Thank you. I was curious on the outlook for CAPS orders. So, I mean, thematically, it sounds like things are very, very strong and there’s good levels of inquiry and so forth. But if I just look at first quarter fell off from arguably an exceptional fourth quarter. But maybe in the context of those two data points, how do you see orders developing for the remainder of the year here?

Yeah. Actually, Jose referenced the fact that like in one of our CAPS business units. In the first quarter, we had three different projects we were bidding that exceeded $100 million that the customer came back to us and says, hey, if we want to go with NOV, we recognize NOV superior quality and lower risk and better value, but we have got a competitor of yours that offer at a different price, if you will match their price, we will go with you and we said no. And so the pro forma version of our orders for Q1 with those three orders in them would be a very strong book-to-bill in the 120%, 130% I guess. And so like we need to improve our margins in CAPS, 7.5% EBITDA margins in the first quarter are not acceptable and one of the paths to get there is to get better pricing on what we sell.

Hello, Clay? Hello.

I am on the line with you. Is that Marc speaking?

Yes.

Yeah. I do not know what just happened to these gentlemen, it looks like they have just gone off-line. If everyone, if you just stand by, I am going to try to get them back on the call.

Everyone back

Yeah. Hello. This -- hey. Blake, are you back online? Blake, are you back online? Ladies and gentlemen, please standby. I am working to get these folks back online. Thank you for your patience, everyone.

Hello.

Yes. You are live.

Yeah. Great. Thank you. We still have -- Marc, are you still there?

Yeah. I am.

I apologize. Marc, I am not sure what happened, but or how much comment you got?

Oh! You had mentioned there was work you were bidding on that customer or tendering the customer…

Yeah.

… with somebody else and it would have been 120% to 130% kind of book-to-bill. So I guess that kind be the…

No…

… conclusion is.

Yeah. Let me just cap it off by saying that no one should look at our CAPS order trend for the first quarter and become alarmed. Our CAPS book-to-bill. 96% is effective replacement of what we ship. We are being more disciplined around pricing and as our competitors fill up their capacity. We feel very good about the outlook. We also have a number of FEED studies with customers in that business that we think will translate to larger orders on down the road and working closely with customers there.

Okay. Great. Well, thanks. In the interest time, I will just leave it to one.

Marc.

Thanks, Marc.

Operator?

Thank you, Marc. Yes.

We know it’s a very busy day. But if people would like to stay on for an extra 5 minutes after the top of the hour, we can do one or two more questions.

Okay. I have got Arun Jayaram with JPMorgan on the line right now.

Hi, Arun.

Yeah. Good morning. Yeah. Hi, guys. Clay, I wanted to get maybe some insights on what you are seeing from your OFS customers. I mean you have mentioned historically that the OFS ecosystem is an important part of your revenue base and I wanted to see if you could talk about what trends you are seeing from some of your international offshore focused OFS customers, as well as onshore where some of the land drillers have highlighted reduced CapEx trends as they have gone through the earnings season…

Yeah.

… just give on some of the gas risk, I’d love to get your thoughts on that and…

Yeah. I think with respect to your last observation, most of that’s in North America. Well, we tell you it’s a very different picture overseas and so we are very encouraged about interest and demand for land operations both in South America, as well as the Arabian Gulf. And for instance, we have won -- there was a land tender by an NOC, land rig tender, pretty good size and we are selling the components into the Asian rig packager that is going to be providing those rigs to that NOC. With respect to our Arabian rig manufacturing joint venture in Saudi Arabia. As you know, we have been delivering rigs to Sunaad [ph] there and pleased with the progress there. In addition, we have another drilling contract that we think we are very close to landing a couple of rig order from as well as other drilling contractors in the Kingdom that are talking to us about the need to really upgrade the fleets. And that’s pressure that’s coming from the NOC, happy with the level of efficiency coming out of the old fleets that predominate in those regions or in South America and so I think that’s going to be the engine that it drives upgrade onshore. And then with respect to the offshore, we are hearing this from all over, more offshore rigs going back to work, and we, of course, work closely with the drilling contractors that run those rigs, along with providing services directly to those rigs. And so for instance, our brand business, our waste management, drill cutting processing business, they are rigging up on a lot of offshore rigs and anticipate better things in the second half of 2023 as more rigs spud and these programs get underway and we can provide services directly into those. Likewise, our Tuboscope business, it’s pipe operation here on the Gulf Coast, Amelia, at Sheldon Road or staying a lot more offshore pipe coming in, in support of offshore operations. So really all around the world, everyone is kind of looking at the same data set and seeing growth ahead in the offshore.

And real quickly on the Sunaad new builds, how many of those are in backlog and is the opportunity set 50 there?

Yeah. I think we have delivered three, two are working. We are in the process of doing the third. We are building four and five. The total order is 50 rigs. And so remaining would be 50 minus the rigs I just described to you.

Sounds good. Really appreciate it.

Yeah. Thank you, Arun. We have time for one…

Can you hear us?

Yes. I can hear you.

Hello?

I can hear you. Yes. Tom Curran with Seaport. Your line is open.

Good morning. Can everyone hear me?

You know what, I believe that we have lost NOV again.

Okay.

I am so sorry for the technical difficulties today, folks. Let’s give them a moment to see if they can dial back in.

Sure.

It is. I am unable to connect them from my end. Dial back into call.

I understand.

Okay. Blake?

Yes. We are going to go ahead and wrap it up, but let’s pass it over to Clay Williams -- we are going to pass it over to Clay Williams, Chairman and CEO, for closing remarks.

Thank you, Blake, and thank you, Operator. Appreciate all everybody joining in on a very busy earnings day. We look forward to updating you on our second quarter results in July. Have a great day.

Thank you everyone for participating in today’s conference. This does conclude the program. You may now disconnect.