ПРЕДОСТЕРЕЖЕНИЕ ОТНОСИТЕЛЬНО ПРОГНОЗНЫХ ЗАЯВЛЕНИЙ

 This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). These forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond the Company's control. All statements,
other than statements of historical fact, included in this Quarterly Report on
Form 10-Q regarding our strategy, future operations, financial position,
estimated revenues and losses, projected costs, prospects, plans and objectives
of management are forward-looking statements. When used in this Quarterly Report
on Form 10-Q, the words "will," "could," "believe," "anticipate," "intend,"
"estimate," "expect," "may," "continue," "predict," "potential," "project" and
similar expressions are intended to identify forward-looking statements,
although not all forward-looking statements contain such identifying words. All forward-looking statements speak only as of the date of this Quarterly
Report on Form 10-Q. We disclaim any obligation to update or revise these
statements unless required by law, and you should not place undue reliance on
these forward-looking statements. Although we believe that our plans, intentions
and expectations reflected in or suggested by the forward-looking statements we
make in this Quarterly Report on Form 10-Q are reasonable, we can give no
assurance that these plans, intentions or expectations will be achieved. We
disclose important factors that could cause our actual results to differ
materially from our expectations in "Risk Factors" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in our Annual
Report on Form 10-K filed with the SEC on March 4, 2022, and elsewhere in this
Quarterly Report on Form 10-Q. These cautionary statements qualify all
forward-looking statements attributable to us or persons acting on our behalf. 

Обзор

 We are a global company serving the oil, natural gas, industrial and renewable
energy industries. FET provides value added solutions aimed at improving the
safety, efficiency and environmental impact of our customers' operations. We are
an environmentally and socially responsible company headquartered in Houston,
Texas with manufacturing, distribution and service facilities strategically
located throughout the world. Our products include highly engineered capital
equipment as well as consumable products. These consumable products are used in
drilling, well construction and completions activities, within the supporting
infrastructure, and at processing centers and refineries. Our engineered capital
products are directed at drilling rig equipment for new rigs, upgrades and
refurbishment projects, 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.
For the nine months ended September 30, 2022, approximately 52% 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 design, manufacture and supply high quality reliable products that create
value for our diverse customer base, which includes, among others, oil and
natural gas operators, land and offshore drilling contractors, oilfield service
companies, subsea construction and service companies, and pipeline and refinery
operators. In addition, we offer some of our products to renewable energy and
new energy companies. We expect that the world's long-term energy demand will continue to rise. We
also expect hydrocarbons will continue to play a vital role in meeting the
world's long-term energy needs while renewable energy sources continue to
develop. As such, we remain focused on serving our customers in both oil and
natural gas as well as renewable energy applications. We are also continuing to
develop products to help oil and natural gas operators lower their emissions
while also deploying our existing product technologies in renewable energy
applications and seeking to develop innovative equipment. 16
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Краткое описание продуктов и услуг, предлагаемых каждым сегментом, выглядит следующим образом:

 •Drilling & Downhole. This segment designs, manufactures and supplies products
and provides related services to the drilling, well construction, artificial
lift and subsea energy construction markets, including applications in oil and
natural gas, renewable energy, defense, and communications. The products and
related services consist primarily of: (i) capital equipment and a broad line of
expendable products consumed in the drilling process; (ii) well construction
casing and cementing equipment and protection products for artificial lift
equipment and cables; and (iii) subsea remotely operated vehicles ("ROVs") and
trenchers, submarine rescue vehicles, specialty components and tooling, and
complementary subsea technical services. •Completions. This segment designs, manufactures and supplies products and
provides related services to the coiled tubing, well stimulation and
intervention markets. The products and related services consist primarily of:
(i) capital and consumable products sold to the pressure pumping, hydraulic
fracturing and flowback services markets, 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. •Production. This segment designs, manufactures and supplies products and
provides related equipment and services for production and infrastructure
markets. The products and related services 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 serving oil and
natural gas customers as well as power generation, renewable energy and other
general industrial applications. 

Рыночные условия

Спрос на наши продукты и услуги напрямую связан с капиталом и операционным бюджетом наших клиентов. Эти бюджеты сильно зависят от текущих и ожидаемых цен на энергоносители. Кроме того, спрос на нашу капитальную продукцию обусловлен использованием оборудования сервисных компаний. Использование зависит от мощности и долговечности оборудования в сложных условиях.

 In 2021, distribution of vaccines and reopening of certain economies led to an
increase in demand for oil and natural gas following an unprecedented decline
from the COVID-19 pandemic. At the same time, the supply of oil and natural gas
was impacted by ongoing capacity constraints by OPEC+ and North American
exploration and production companies. As a result of these supply and demand
factors, commodity prices increased substantially in 2021. During the first nine months of 2022, the supply of oil and natural gas was
further impacted by political and social responses to the Russia and Ukraine war
resulting in further increases in energy prices, especially in Europe. In
addition, ongoing COVID-19 outbreaks, related work restrictions and other
worldwide labor constraints continue to cause disruptions in global supply
chains. These disruptions have led to inflationary pressures. In response, the
Federal Reserve raised interest rates significantly in 2022 and further rate
increases are expected. These macroeconomic conditions could lead to a global or
regional recession, which may lower demand for commodities, such as oil and
natural gas, and have a direct impact on commodity prices. Our revenues are highly correlated to the U.S. drilling rig count, which has
increased to 765 rigs as of the end of the third quarter 2022 from a low of 244
rigs in August 2020. The level of active hydraulic fracturing fleets has also
increased substantially in order to meet increasing oil and natural gas demand.
Despite these improvements, drilling and completions activity remains below
pre-pandemic levels. In addition, publicly owned exploration and production
companies in North America remain under pressure by investors to constrain
capital expenditures in order to generate positive cash flows. In contrast,
privately owned exploration and production companies in North America have
increased their drilling and completions activity in response to the higher oil
and natural gas price environment. It is generally expected that public and
private exploration and production companies will continue to make investments
in a similar fashion for at least the next twelve months. Activity levels have also increased in international markets, as well as in
global offshore and subsea activity. As a result, demand for our drilling and
subsea offerings has increased due to an improved outlook for our international
drilling and subsea customers. 17
-------------------------------------------------------------------------------- The table below shows average crude oil and natural gas prices for West Texas
Intermediate crude oil ("WTI"), United Kingdom Brent crude oil ("Brent"), and
Henry Hub natural gas: Three Months Ended September 30, June 30, September 30, 2022 2022 2021
Average global oil, $/bbl
West Texas Intermediate $ 93.06$ 108.83$ 70.54
United Kingdom Brent $ 100.71$ 113.84$ 73.51Average North American Natural Gas, $/Mcf
Henry Hub $ 8.03 $ 

7,50 $ 4,35

 The price of oil has varied dramatically over the last several years. The spot
prices for WTI and Brent fell from $61.14 and $67.77 per barrel, respectively,
as of December 31, 2019 to lows below $15.00 per barrel in April 2020. Since
that time, oil prices rebounded to an average of $108.83 and $113.84, for WTI
and Brent, respectively, in the second quarter 2022, and retreated to $93.06 and
$100.71, respectively, in the third quarter 2022. In addition, natural gas
prices have increased by 85% comparing the third quarter 2022 to the third
quarter 2021. The table below shows the average number of active drilling rigs, based on the
weekly Baker Hughes Incorporated rig count, operating by geographic area and
drilling for different purposes. Three Months Ended September 30, June 30, September 30, 2022 2022 2021
Active Rigs by Location
United States 761 713 496
Canada 199 113 151
International 857 812 772
Global Active Rigs 1,817 1,638 1,419 Land vs. Offshore Rigs
Land 1,590 1,430 1,222
Offshore 227 208 197
Global Active Rigs 1,817 1,638 1,419 U.S. Commodity Target
Oil/Gas 599 564 394
Gas 158 148 101
Unclassified 4 1 1
Total U.S. Active Rigs 761 713 496 U.S. Well Path
Horizontal 692 652 451
Vertical 28 26 20
Directional 41 35 25
Total U.S. Active Rigs 761 713 496 A substantial portion of our revenue is impacted by the level of rig activity
and the number of wells completed. The average U.S. rig count for the third
quarter 2022 was 7% and 53% higher compared to the second quarter 2022 and third
quarter 2021, respectively. The U.S. rig count started 2020 at 805 working rigs
and fell 70% to a low of 244 rigs in August 2020. Since that time, the number of
active rigs has partially recovered, ending the third quarter 2022 at 765 rigs.
Despite this improvement, the U.S. drilling rig count remains below pre-pandemic
levels. 18
-------------------------------------------------------------------------------- The table below shows the amount of total inbound orders by segment:
(in millions of dollars) Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, September 30, 2022 2022 2021 2022 2021
Drilling & Downhole $ 73.3 $ 74.4 $ 83.4 $ 218.6$ 221.8
Completions 78.7 64.7 59.6 197.1 154.2
Production 45.7 63.8 32.8 149.9 96.6
Total Orders $ 197.7$ 202.9$ 175.8$ 565.6$ 472.6 19

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Результаты операций

 Three months ended September 30, 2022 compared with three months ended September
30, 2021 Three Months Ended September 30, Change
(in thousands of dollars, except per share
information) 2022 2021 $ %
Revenue:
Drilling & Downhole $ 75,723$ 63,180$ 12,543 19.9 %
Completions 72,246 49,692 22,554 45.4 %
Production 34,238 28,457 5,781 20.3 %
Eliminations (372) (345) (27) (7.8) %
Total revenue 181,835 140,984 40,851 29.0 %
Operating income (loss):
Drilling & Downhole 9,481 4,042 5,439 134.6 %
Operating margin % 12.5 % 6.4 %
Completions 5,915 250 5,665 *
Operating margin % 8.2 % 0.5 %
Production 665 (3,374) 4,039 119.7 %
Operating margin % 1.9 % (11.9) %
Corporate (8,411) (8,387) (24) (0.3) %
Total segment operating income (loss) 7,650 (7,469) 15,119 202.4 %
Operating margin % 4.2 % (5.3) %
Gain on disposal of assets and other (52) (93) 41 44.1 %
Operating income (loss) 7,702 (7,376) 15,078 204.4 %
Interest expense 8,143 7,128 1,015 14.2 %
Foreign exchange gains and other, net (18,288) (3,962) (14,326) *
Loss on extinguishment of debt - 196 (196) (100.0) %
Total other (income) expense, net (10,145) 3,362 (13,507) (401.8) %
Income (loss) before income taxes 17,847 (10,738) 28,585 266.2 %
Income tax expense 1,370 849 521 61.4 %
Net income (loss) $ 16,477$ (11,587)$ 28,064 242.2 % Weighted average shares outstanding
Basic 5,778 5,661
Diluted 10,552 5,661
Earnings (loss) per share
Basic $ 2.85 $ (2.05)
Diluted $ 1.82 $ (2.05)
* not meaningful 20

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Доход

Our revenue for the three months ended September 30, 2022 was $181.8 million, an
increase of $40.9 million, or 29.0%, compared to the three months ended
September 30, 2021. For the three months ended September 30, 2022, our Drilling
& Downhole, Completions, and Production segments comprised 41.6%, 39.6%, and
18.8% of our total revenue, respectively, which compared to 44.8%, 35.0%, and
20.2% of our total revenue, respectively, for the three months ended September
30, 2021. The overall increase in revenue is primarily related to higher sales
volumes due to higher drilling and completions activity levels in the third
quarter 2022 compared to the third quarter 2021. The changes in revenue by
operating segment consisted of the following: Drilling & Downhole segment - Revenue was $75.7 million for the three months
ended September 30, 2022, an increase of $12.5 million, or 19.9%, compared to
the three months ended September 30, 2021. This increase was led by a $14.9
million, or 64.4%, increase in revenue for our Drilling Technologies product
line due to higher sales volumes of consumable products and capital equipment
from the 28% year-over-year increase in global rig count. Revenue for our
Downhole Technologies product line increased by $4.3 million, or 24.4%,
primarily due to higher sales volumes of artificial lift products due to the
increase in the number of well completions and workover activity in the third
quarter 2022 compared to the third quarter 2021. Revenue for our Subsea
Technologies product line decreased by $6.7 million, or (30.0)%, from lower
sales of Work Class ROVs into domestic and international markets. Completions segment - Revenue was $72.2 million for the three months ended
September 30, 2022, an increase of $22.6 million, or 45.4%, compared to the
three months ended September 30, 2021. This significant improvement includes a
revenue increase of $18.1 million, or 70.7%, for our Stimulation & Intervention
product line primarily due to higher capital equipment sales to pressure pumping
customers and increasing service company demand of wireline cable to support
hydraulic fracturing activity. Revenue for our Coiled Tubing product line
increased by $4.5 million, or 18.5%, driven by increasing U.S. hydraulic
fracturing activity levels in the third quarter 2022 compared to the third
quarter 2021. Production segment - Revenue was $34.2 million for the three months ended
September 30, 2022, an increase of $5.8 million, or 20.3%, compared to the three
months ended September 30, 2021. This increase was driven by a $4.1 million, or
29.0%, increase in project revenue for our processing and treatment equipment
within our Production Equipment product line and a $1.6 million, or 11.5%,
increase in sales of our valve products, primarily due to higher sales volumes
into the North America downstream market. 

Операционная прибыль (убыток) сегмента и процент операционной маржи сегмента

 Segment operating income for the three months ended September 30, 2022 was $7.7
million, a $15.1 million improvement compared to a loss of $7.5 million for the
three months ended September 30, 2021. For the three months ended September 30,
2022, segment operating margin percentage was 4.2% compared to (5.3)% for the
three months ended September 30, 2021. Segment operating margin percentage is
calculated by dividing segment operating income (loss) by revenue for the
period. The change in operating income (loss) for each segment is explained as
follows: Drilling & Downhole segment - Segment operating income was $9.5 million, or
12.5%, for the three months ended September 30, 2022 compared to operating
income of $4.0 million, or 6.4%, for the three months ended September 30, 2021.
The $5.4 million improvement in segment operating results is primarily
attributable to higher gross profit from the 19.9% increase in segment revenues,
partially offset by higher freight and employee related costs. Completions segment - Segment operating income was $5.9 million, or 8.2%, for
the three months ended September 30, 2022 compared to segment operating income
of $0.3 million, or 0.5%, for the three months ended September 30, 2021. The
$5.7 million improvement in segment operating results was primarily due to
higher gross profit from the 45.4% increase in revenues discussed above,
partially offset by higher freight and employee related costs. Production segment - Segment operating income was $0.7 million, or 1.9%, for the
three months ended September 30, 2022 compared to a loss of $3.4 million, or
(11.9)%, for the three months ended September 30, 2021. The $4.0 million
improvement in segment operating results was driven by the 20.3% increase in
revenues discussed above as well as lower depreciation and other facility costs
in connection with cost reductions implemented in 2021. These improvements were
partially offset by higher freight and material costs as a result of
inflationary pressures from global supply chains. Corporate - Selling, general and administrative expenses for Corporate remained
flat at $8.4 million for the three months ended September 30, 2022 compared with
the three months ended September 30, 2021. Corporate costs 21
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включать, помимо прочего, расходы, связанные с заработной платой, для управленческого, административного, финансового, юридического и кадрового персонала; профессиональные гонорары за юридические, бухгалтерские и сопутствующие услуги; и затраты на маркетинг.

Прочие статьи, не включенные в операционный доход (убыток) сегмента

Прибыль от выбытия активов и прочее не включается в операционный доход (убыток) сегмента, но включается в общий операционный убыток.

Прочие доходы и расходы

 Other income and expense includes interest expense, foreign exchange gains and
other, and loss on extinguishment of debt. We incurred $8.1 million of interest
expense during the three months ended September 30, 2022, an increase of $1.0
million compared to the three months ended September 30, 2021 due to higher
interest rates on borrowings under the credit facility. The foreign exchange gains are primarily the result of movements in the British
pound, Euro and Canadian dollar relative to the U.S. dollar. These movements in
exchange rates create foreign exchange gains or losses when applied to monetary
assets or liabilities denominated in currencies other than the location's
functional currency, primarily U.S. dollar denominated cash, trade account
receivables and net intercompany receivable balances for our entities using a
functional currency other than the U.S. dollar. During the three months ended September 30, 2021, we repurchased an aggregate
$1.9 million principal amount of our 2025 Notes at approximately par value. The
net carrying value of the extinguished debt, including unamortized debt discount
and debt issuance costs, was $1.7 million, resulting in a $0.2 million loss on
extinguishment of debt. Taxes We recorded tax expense of $1.4 million and $0.8 million for the three months
ended September 30, 2022 and September 30, 2021, respectively. The estimated
annual effective tax rates for the three months ended September 30, 2022 and
2021 were impacted by losses in jurisdictions where the recording of a tax
benefit is not available. Furthermore, the tax expense or benefit recorded can
vary from period to period depending on the Company's relative mix of earnings
and losses by jurisdiction. 22
-------------------------------------------------------------------------------- Nine months ended September 30, 2022 compared with nine months ended September
30, 2021 Nine Months Ended September 30, Change 2022 2021 $ %
(in thousands of dollars, except per share
information)
Revenue:
Drilling & Downhole $ 223,476$ 173,406$ 50,070 28.9 %
Completions 190,867 134,051 56,816 42.4 %
Production 95,622 85,825 9,797 11.4 %
Eliminations (710) (361) (349) (96.7) %
Total revenue 509,255 392,921 116,334 29.6 %
Operating income (loss):
Drilling & Downhole 23,995 2,237 21,758 972.6 %
Operating margin % 10.7 % 1.3 %
Completions 8,787 (52) 8,839 *
Operating margin % 4.6 % - %
Production (1,241) (11,256) 10,015 89.0 %
Operating margin % (1.3) % (13.1) %
Corporate (24,501) (23,667) (834) (3.5) %
Total segment operating income (loss) 7,040 (32,738) 39,778 121.5 %
Operating margin % 1.4 % (8.3) %
Gain on disposal of assets and other (938) (1,362) 424 31.1 %
Operating income (loss) 7,978 (31,376) 39,354 125.4 %
Interest expense 23,609 24,065 (456) (1.9) %
Foreign exchange gains and other, net (37,112) (1,431) (35,681) *
Loss on extinguishment of debt - 5,290 (5,290) (100.0) %
Total other (income) expense (13,503) 27,924 (41,427) (148.4) %
Income (loss) before income taxes 21,481 (59,300) 80,781 136.2 %
Income tax expense 4,939 3,756 1,183 31.5 %
Net income (loss) $ 16,542$ (63,056)$ 79,598 126.2 % Weighted average shares outstanding
Basic 5,736 5,637
Diluted 10,489 5,637
Earnings (loss) per share
Basic $ 2.88 $ (11.19)
Diluted $ 2.37 $ (11.19)
* not meaningful 23

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Доход

 Our revenue for the nine months ended September 30, 2022 was $509.3 million, an
increase of $116.3 million, or 29.6%, compared to the nine months ended
September 30, 2021. For the nine months ended September 30, 2022, our Drilling &
Downhole, Completions, and Production segments comprised 43.9%, 37.3%, and 18.8%
of our total revenue, respectively, which compared to 44.1%, 34.1%, and 21.8% of
our total revenue, respectively, for the nine months ended September 30, 2021.
The overall increase in revenue is related to higher sales volumes due to
improving market conditions in the first nine months of 2022 compared to the
first nine months of 2021 as a result of higher drilling and completions
activity levels to support increasing global energy demand. The changes in
revenue by operating segment consisted of the following: Drilling & Downhole segment - Revenue was $223.5 million for the nine months
ended September 30, 2022, an increase of $50.1 million, or 28.9%, compared to
the nine months ended September 30, 2021. This increase was led by revenue
growth of $31.6 million, or 45.5%, in our Drilling Technologies product line
from higher sales of capital equipment and consumable products from the 29%
year-over-year increase in global rig count. Revenue for our Downhole
Technologies product line increased by $13.6 million, or 27.5%, primarily due to
higher sales of artificial lift products as a result of higher well completions
activity levels. Revenue for our Subsea Technologies product line increased by
$4.9 million, or 9.0%, primarily due to higher sales of Observation Class ROVs
and cable management systems into domestic and international markets. Completions segment - Revenue was $190.9 million for the nine months ended
September 30, 2022, an increase of $56.8 million, or 42.4%, compared to the nine
months ended September 30, 2021. This increase includes a $42.5 million, or
62.0%, increase in sales volumes for our Stimulation and Intervention product
line and a $14.3 million, or 21.8%, increase in sales volumes for our Coiled
Tubing product line. These higher revenue levels were driven by increasing U.S.
hydraulic fracturing and well intervention service activity levels in the first
nine months of 2022 compared to the same period of 2021 in response to higher
energy demand. Production segment - Revenue was $95.6 million for the nine months ended
September 30, 2022, an increase of $9.8 million, or 11.4%, compared to the nine
months ended September 30, 2021. This increase is driven by higher sales volumes
of valves, primarily in the North America downstream market, and higher project
revenue for our processing and treatment equipment within our Production
Equipment product line as demand continues to recover from the COVID 19
pandemic. 

Операционная прибыль (убыток) сегмента и процент операционной маржи сегмента

 Segment operating income for the nine months ended September 30, 2022 was $7.0
million, a $39.8 million improvement compared to a loss of $32.7 million for the
nine months ended September 30, 2021. For the nine months ended September 30,
2022, segment operating margin percentage was 1.4% compared to (8.3)% for the
nine months ended September 30, 2021. Segment operating margin percentage is
calculated by dividing segment operating income (loss) by revenue for the
period. The change in operating income (loss) for each segment is explained as
follows: Drilling & Downhole segment - Segment operating income was $24.0 million, or
10.7%, for the nine months ended September 30, 2022 compared to $2.2 million, or
1.3%, for the nine months ended September 30, 2021. The $21.8 million
improvement in segment operating results is primarily attributable to higher
gross profit from the 28.9% increase in revenue discussed above. In addition,
segment operating results also improved due to a $3.9 million reduction in
inventory write downs and lower restructuring related costs in connection with
cost reductions executed in early 2021. Completions segment - Segment operating income was $8.8 million, or 4.6%, for
the nine months ended September 30, 2022 compared to a loss of $0.1 million for
the nine months ended September 30, 2021. The $8.8 million improvement in
segment operating results is primarily attributable to higher gross profit from
the 42.4% increase in revenues discussed above, partially offset by higher
freight and employee related costs. 24
-------------------------------------------------------------------------------- Production segment - Segment operating loss was $1.2 million, or (1.3)%, for the
nine months ended September 30, 2022 compared to a loss of $11.3 million, or
(13.1)%, for the nine months ended September 30, 2021. The $10.0 million
improvement is primarily attributable to higher gross margin from the 11.4%
revenue growth discussed above as well as lower depreciation and other facility
costs in connection with cost reductions implemented in 2021. These improvements
were partially offset by higher freight and material costs as a result of
inflationary pressures from global supply chains. Corporate - Selling, general and administrative expenses for Corporate were
$24.5 million for the nine months ended September 30, 2022, a $0.8 million
increase compared to the nine months ended September 30, 2021. This increase was
primarily related to higher professional fees. Corporate costs include, among
other items, payroll related costs for management, administration, finance,
legal, and human resources personnel; professional fees for legal, accounting
and related services; and marketing costs. 

Прочие статьи, не включенные в операционный доход (убыток) сегмента

Прибыль от выбытия активов и прочее не включается в операционный доход (убыток) сегмента, но включается в общий операционный убыток.

Прочие расходы

 Other expense includes interest expense, foreign exchange (gains) losses and
other, and loss on extinguishment of debt. We incurred $23.6 million of interest
expense during the nine months ended September 30, 2022, a decrease of $0.5
million from the nine months ended September 30, 2021 primarily due to the lower
average outstanding balance on our 2025 Notes in the nine months ending
September 30, 2022. The foreign exchange (gains) losses are primarily the result of movements in the
British pound, Euro and Canadian dollar relative to the U.S. dollar. These
movements in exchange rates create foreign exchange gains or losses when applied
to monetary assets or liabilities denominated in currencies other than the
location's functional currency, primarily U.S. dollar denominated cash, trade
account receivables and net intercompany receivable balances for our entities
using a functional currency other than the U.S. dollar. During the nine months ended September 30, 2021, we repurchased an aggregate
$59.9 million of principal amount of our 2025 Notes for $58.6 million. The net
carrying value of the extinguished debt, including unamortized debt discount and
debt issuance costs, was $53.3 million, resulting in a $5.3 million loss on
extinguishment of debt. 

Налоги

 We recorded a tax expense of $4.9 million and expense of $3.8 million for the
nine months ended September 30, 2022September 30, 2021, respectively. The
estimated annual effective tax rates for the nine months ended September 30,
2022 and 2021 were impacted by losses in jurisdictions where the recording of a
tax benefit is not available. Furthermore, the tax expense or benefit recorded
can vary from period to period depending on the Company's relative mix of
earnings and losses by jurisdiction. 

Ликвидность и капитальные ресурсы

Источники и использование ликвидности

 Our internal sources of liquidity are cash on hand and cash flows from
operations, while our primary external sources include trade credit, the Credit
Facility and the 2025 Notes. Our primary uses of capital have been for
inventory, sales on credit to our customers, maintenance and growth capital
expenditures, and debt repayments. We continually monitor other potential
capital sources, including equity and debt financing, to meet our investment and
target liquidity requirements. Our future success and growth will be highly
dependent on our ability to generate positive operating cash flow and access
outside sources of capital. As of September 30, 2022, we had $257.0 million principal amount of 2025 Notes
outstanding and $10.7 million of borrowings outstanding under our revolving
Credit Facility. The 2025 Notes mature in August 2025 and subject to certain
exceptions, the Credit Facility matures in September 2026. See Note 7 Debt for
further details related to the terms for our 2025 Notes and Credit Facility. As of September 30, 2022, we had cash and cash equivalents of $19.8 million and
$127.2 million of availability under the Credit Facility. We anticipate that our
future working capital requirements for our operations will fluctuate
directionally with revenues. Furthermore, availability under the Credit Facility
will fluctuate directionally based on the level of our eligible accounts
receivable and inventory subject to applicable sublimits. In addition, we
continue to 25
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ожидается, что общие капитальные затраты в 2022 году составят менее 10,0 млн долларовсостоящая, среди прочего, из заменяющих вышедшие из эксплуатации машин и оборудования.

 We expect our available cash on-hand, cash generated by operations, and
estimated availability under the Credit Facility to be adequate to fund current
operations during the next 12 months. In addition, based on existing market
conditions and our expected liquidity needs, among other factors, we may use a
portion of our cash flows from operations, proceeds from divestitures,
securities offerings or other eligible capital to reduce the principal amount of
our 2025 Notes outstanding or repurchase shares of our common stock under our
repurchase program. In November 2021, our board of directors approved a program for the repurchase
of outstanding shares of our common stock with an aggregate purchase amount of
up to $10.0 million. Shares may be repurchased under the program from time to
time, in amounts and at prices that the company deems appropriate, subject to
market and business conditions, applicable legal requirements and other
considerations. As of the end of the third quarter 2022, we repurchased
approximately 56,000 shares of our common stock for aggregate consideration of
approximately $1.1 million with remaining authorization under this program of
$8.9 million. In the fourth quarter of 2021, we completed the acquisition of Hawker for total
cash consideration of $5.1 million, of which, $3.4 million was paid in the
fourth quarter of 2021 with the balance expected to be paid over the next five
years, including $0.5 million paid in the first nine months of 2022. For
additional information, see Note 4 Acquisitions. We may pursue other
acquisitions in the future, which may be funded with cash and/or equity. Our
ability to make significant acquisitions for cash may require us to pursue
additional equity or debt financing, which we may not be able to obtain on terms
acceptable to us or at all. 

Наши денежные потоки за девять месяцев, закончившихся 30 сентября 2022 г. и 2021 представлены ниже (в миллионах):

 Nine 

Месяцы закончились 30 сентября,

 2022 2021
Net cash used in operating activities $ (32.1) $ (8.1)
Net cash provided by (used in) investing activities (2.6) 4.5
Net cash provided by (used in) financing activities 9.2 (74.6)
Effect of exchange rate changes on cash (1.6) (0.4)

Чистое уменьшение денежных средств, их эквивалентов и денежных средств с ограничением использования $ (27,1) $ (78,6)

Чистые денежные средства, использованные в операционной деятельности

 Net cash used in operating activities was $32.1 million for the nine months
ended September 30, 2022 compared to $8.1 million for the nine months ended
September 30, 2021. This decline in operating cash flows is primarily
attributable to net increases in working capital, primarily inventory and
accounts receivable, which used cash of $85.6 million for the nine months ended
September 30, 2022 compared to providing cash of $2.8 million for the nine
months ended September 30, 2021. This decline was partially offset by an
improvement in net income adjusted for non-cash items, which provided $53.4
million of cash for the nine months ended September 30, 2022 compared to using
$10.9 million for the nine months ended September 30, 2021. 

Чистые денежные средства, предоставленные (использованные) в результате инвестиционной деятельности

 Net cash used in investing activities was $2.6 million for the nine months ended
September 30, 2022, including $4.8 million of capital expenditures, partially
offset by $2.7 million of proceeds from the sale of property and equipment. Net
cash provided by investing activities was $4.5 million for the nine months ended
September 30, 2021, including $6.8 million of proceeds from the sale of property
and equipment, partially offset by $1.3 million of cash paid for the net working
capital settlement related to the disposition of our ABZ and QVA valve brands
and $1.0 million of capital expenditures. 

Чистые денежные средства, предоставленные (использованные) в финансовой деятельности

 Net cash provided by financing activities was $9.2 million for the nine months
ended September 30, 2022 compared to $74.6 million of cash used in financing
activities for the nine months ended September 30, 2021, respectively. The
change in net cash provided by (used in) financing activities primarily resulted
from $10.7 million of net borrowings on the revolving Credit Facility for the
nine months ended September 30, 2022 compared to a net $58.6 million of cash
used to repurchase 2025 Notes and $13.1 million of repayments on the revolving
Credit Facility during the nine months ended September 30, 2021. 26
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Дополнительная финансовая информация о поручителях

 The Company's 2025 Notes are guaranteed by our domestic subsidiaries which are
100% owned, directly or indirectly, by the Company. The guarantees are full and
unconditional, joint and several. The guarantees of the 2025 Notes are (i) pari passu in right of payment with all
existing and future senior indebtedness of such guarantor, including all
obligations under our Credit Facility; (ii) secured by certain collateral of
such guarantor, subject to permitted liens under the indenture governing the
2025 Notes; (iii) effectively senior to all unsecured indebtedness of that
guarantor, to the extent of the value of the collateral securing the 2025 Notes
(after giving effect to the liens securing our Credit Facility and any other
senior liens on the collateral); and (v) senior in right of payment to any
future subordinated indebtedness of that guarantor. In the event of a bankruptcy, liquidation or reorganization of any of the
non-guarantor subsidiaries of the 2025 Notes, the non-guarantor subsidiaries of
such notes will pay the holders of their debt and their trade creditors before
they will be able to distribute any of their assets to the Company or to any
guarantors. The 2025 Notes guarantees shall each be released upon (i) any sale or other
disposition of all or substantially all of the assets of such guarantor (by
merger, consolidation or otherwise) to a person that is not (either before or
after giving effect to such transaction) the Company or a subsidiary, if the
sale or other disposition does not violate the applicable provisions of the
indenture governing such notes; (ii) any sale, exchange or transfer (by merger,
consolidation or otherwise) of the equity interests of such guarantor after
which the applicable guarantor is no longer a subsidiary, which sale, exchange
or transfer does not violate the applicable provisions of the indenture
governing such notes; (iii) legal or covenant defeasance or satisfaction and
discharge of the indenture governing such notes; or (iv) dissolution of such
guarantor, provided no default or event of default has occurred that is
continuing. The obligations of each guarantor of the 2025 Notes under its guarantee will be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such guarantor (including, without
limitation, any guarantees under the Credit Facility) and any collections from
or payments made by or on behalf of any other guarantor in respect of the
obligations of such other guarantor under its guarantee or pursuant to its
contribution obligations under the applicable indenture, result in the
obligations of such guarantor under its guarantee not constituting a fraudulent
conveyance, fraudulent preference or fraudulent transfer or otherwise reviewable
transaction under applicable law. Nonetheless, in the event of the bankruptcy,
insolvency or financial difficulty of a guarantor, such guarantor's obligations
under its guarantee may be subject to review and avoidance under applicable
fraudulent conveyance, fraudulent preference, fraudulent transfer and insolvency
laws. We are presenting the following summarized financial information for the Company
and the subsidiary guarantors (collectively referred to as the "Obligated
Group") pursuant to Rule 13-01 of Regulation S-X, Guarantors and Issuers of
Guaranteed Securities Registered or Being Registered. For purposes of the
following summarized financial information, transactions between the Company and
the subsidiary guarantors, presented on a combined basis, have been eliminated
and information for the non-guarantor subsidiaries have been excluded. Amounts
due to the non-guarantor subsidiaries and other related parties, as applicable,
have been separately presented within the summarized financial information
below. 27
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Обобщенная финансовая информация за промежуточный период с начала года и за последний годовой период была следующей (в тысячах):

© Эдгар Онлайн, источник Проблески