NOW(DNOW) - 2024 Q3 - Quarterly Report

Financial Performance - For the three months ended September 30, 2024, the company generated net income of $13 million on revenue of$606 million, representing a revenue increase of $18 million or 3.1$23 million for the three months ended September 30, 2024, down from $37 million in the same period of 2023[55]. - For the three months ended September 30, 2024, total revenue was$606 million, an increase of $18 million or 3.1$588 million in 2023[59]. - The U.S. segment generated revenue of $482 million for the three months ended September 30, 2024, up$34 million or 7.6% from $448 million in 2023[58]. - The International segment reported a revenue decrease of$13 million or 18.1% to $59 million for the three months ended September 30, 2024, compared to$72 million in 2023[61]. - Operating profit for the total company was $23 million for the three months ended September 30, 2024, down from$37 million in 2023, reflecting a decline of $14 million or 37.8$176 million, an increase from $83 million in the same period of 2023, driven by improved inventory efficiency and better collections[70]. - Net cash used in investing activities for the same period was$190 million, significantly higher than $47 million in 2023, primarily due to business acquisitions totaling$185 million[70]. - Net cash used in financing activities decreased to $25 million from$54 million in the prior year, with $18 million allocated for share repurchases compared to$49 million in 2023[70]. - The company repurchased 1,379,020 shares for approximately $18 million during the nine months ended September 30, 2024, with$6 million remaining under the share repurchase program[74]. - The company plans to fund future cash acquisitions primarily with cash on hand, cash flow from operations, and the available portion of the revolving credit facility[73]. Operational Highlights - The company operates approximately 165 locations globally, with around 2,550 employees[42]. - The company has expanded its operations through acquisitions and organic investments in several countries, including Australia, Canada, and the UAE[43]. - The company provides a suite of digital procurement channels through its DigitalNOW® platform to enhance supply chain optimization[42]. - The company serves customers in approximately 80 countries, supported by a supplier network of thousands of vendors across 40 countries[42]. Market Conditions - The average price of West Texas Intermediate Crude declined by 7.4% to $76.24 per barrel in Q3 2024 compared to Q3 2023[49]. - The U.S. rig count decreased by 10.0$2.11 per MMBtu in Q3 2024 compared to Q2 2024[53]. Foreign Currency Impact - The company recognized $8 million in charges related to the restructuring of its International segment, including$5 million in foreign currency translation losses[47]. - A net foreign currency translation gain of $4 million was reported for the nine months ended September 30, 2024, following the liquidation of certain foreign subsidiaries[77]. - The company experienced foreign currency transaction losses of$1 million for both the nine months ended September 30, 2024, and 2023, primarily due to exchange rate fluctuations[77]. - The average foreign exchange rate for the first nine months of 2024 remained flat compared to the same period in 2023, with the Canadian dollar and Australian dollar decreasing by 1% against the U.S. dollar[77]. - The company reported a favorable effect of $1 million from changes in exchange rates on cash and cash equivalents for the nine months ended September 30, 2024[72].