What changed in this filing

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Item 1. Business

2025-03-03 compared with 2024-03-05 · 67 added, 76 removed, 162 unchanged (47% of the section changed)

10 unchanged sentences

Our capital products are directed at drilling rig equipment for constructing new or upgrading existing rigs, subsea construction and development projects, pressure pumping equipment, the placement of production equipment on new producing wells, downstream capital projects and capital equipment for renewable energy projects.

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.

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.

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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.

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.

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 .

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.

In the first quarter 2024, following the acquisition (the “Variperm Acquisition”) of Variperm Holdings Ltd.

(“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.

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.

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 .

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.

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.

There are several factors that drive demand for our Drilling & Downhole segment.

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 Downhole Technologies product line is impacted by the level of well completion activity and complexity of well construction and completion.

Our Subsea Technologies

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.

(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.

There are several factors that drive demand for our Drilling and Completions segment.

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.

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 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.

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Consumable products.

We manufacture a range of consumable products used on drilling rigs, well servicing rigs, and hydraulic fracturing systems.

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.

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.

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.

Downhole Technologies.

We manufacture a broad line of downhole products that are consumed during the construction, completion and production phases of a well’s lifecycle.

Downhole protection systems.

We offer a full selection of downhole protection solutions and artificial lift accessories through our various brands such as Cannon Services™ and Multilift.

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.

We provide both standard and customized protection systems, and we utilize a range of materials in our products for various downhole environments.

SandGuard™ and Cyclone™ branded completion tools extend the useful life of an ESP by protecting it against sand and other solids during shutdown and startup.

Forum’s GasGuard™ branded product also extends the useful life of an ESP by breaking down gas slugs, creating an uninterrupted flow of liquid.

Casing and cementing tools.

Through our Davis-Lynch™ branded downhole well construction operations, we design and manufacture products used in the construction of oil, natural gas and geothermal 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.

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.

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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.

The market for ROVs can be segmented

into three broad classes of vehicles based on size and category of operations:

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.

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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.

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.

Stimulation and Intervention .

4 unchanged sentences

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.

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.

We also manufacture electro-mechanical wireline cables as well as innovative EnviroLite branded (greaseless) cables.

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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.

In addition, our coiled line pipe offering can be utilized to transport carbon for injection into underground storage.

Our coiled line pipe offering serves as an alternative to 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 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.

PRODUCTION SEGMENT

Our Production segment designs, manufactures and supplies products and solutions for the production and infrastructure markets.

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.

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 segment’s primary market driver is the level of spending associated with new producing wells as well as spending on midstream and downstream projects.

(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.

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.

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.

We manufacture a broad line of downhole products that are consumed during the construction, completion and production phases of a well’s lifecycle.

Downhole protection systems.

We offer a full selection of downhole protection solutions and artificial lift accessories through our various brands such as Cannon Services™ and Multilift.

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.

We provide both standard and customized protection systems, and we utilize a range of materials in our products for various downhole environments.

SandGuard™ and Cyclone™ branded completion tools extend the useful life of an ESP by protecting it against sand and other solids during shutdown and startup.

Forum’s GasGuard™ branded product also extends the useful life of an ESP by breaking down gas slugs, creating an uninterrupted flow of liquid.

Casing and cementing tools.

Through our Davis-Lynch™ branded downhole well construction operations, we design and manufacture products used in the construction of oil, natural gas and geothermal 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 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.

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 .

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We utilize our international manufacturing partners to produce completed products and components for the majority of our valve products.

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.

In August 2010, Forum Oilfield Technologies, Inc.

was renamed Forum Energy Technologies, Inc., when four other companies were merged into FET.

On April 17, 2012, we completed our initial public offering.

FET was incorporated in 2005 and on April 17, 2012, we completed our initial public offering.

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.

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.

Our backlog was approximately $241.6 million at December 31, 2023 and approximately $264.8 million at December 31, 2022.

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.

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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.

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.

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.

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.

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.

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.

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.

Patents, trademarks and other intellectual property

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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.

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.

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 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.

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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 typically offer our customers standard payment terms of 30 days, although customers often take 65 days or more to settle accounts.

For sales into certain countries or for select customers, we might require payment upfront or credit support through a letter of credit.

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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.

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.

In addition to environmental and worker safety regulations, we are subject to regulation by numerous other governmental regulatory agencies, including the U.S.

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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.

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.

The trend in environmental regulation has been to impose increasingly stringent restrictions and limitations on activities that may impact the environment, and thus, any changes in environmental laws and regulations or in enforcement policies that result in more stringent and costly waste handling, storage, transport, disposal, or remediation requirements could have a material adverse effect on our operations and financial position.

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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”), the individual states administer some or all of the provisions of the RCRA, sometimes in conjunction with their own, more stringent requirements.

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.

We are required to manage the transportation, storage and disposal of hazardous and non-hazardous wastes in compliance with the RCRA.

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.

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.

These persons include the owner or operator of the site where the release occurred, and anyone who disposed or arranged for the disposal of a hazardous substance released at the site.

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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.

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 addition, it is not uncommon for neighboring landowners and other third-parties to file claims for personal injury and property damage allegedly caused by hazardous substances released into the environment.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business