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Key Energy Services Management Discusses Q2 2012 Results - Earnings Call Transcript

The revenue and profitability of our Coiled Tubing business in the second quarter was much better than first and we're expecting continued revenue growth and margin improvement in the third quarter. The we're definitely applying our own dose of self help. We believe the market of Coiled Tubing services remains favorable, and we feel good about the leadership and operation changes we've made in that business.

Key's Rig Services units have been a strong performer in 2012 and the financial results for the business were roughly in line with our original forecast for the year despite market dynamics that I described earlier. Customer demand for our premium workover rigs in oil markets remain strong and we expect that will remain the case through the year-end.

Internationally, our franchise continues to grow and prosper. We believe that the success of our Mexico operations is attributable to the efforts of our international management group and our operations team in the country. Our talented leadership understands this complicated market very well and have been very effective in demonstrating Key's value and service quality to our customers, thereby enabling us to generate more opportunities there. In fact, in addition to the 40 rigs we're already operating in Mexico, we expect to deploy additional assets there in the second half the year and Trey Wilson will make a commentary on that in his presentation.

Our efforts to sell our Argentine business have been complicated by the change in the political landscape there, yet sale process continuous and we are certainly in discussions with potential buyers. Commensurate with flattening activity levels in the U.S., we recently announced the $100 million of reduction in our capital budget this year. Trey Wilson will elaborate further on our capital plans. Now I'll turn the call over to Trey Whichard for his financial review.

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