Letter To Shareholders

Dear Shareholders,

In 2023, we saw another year of outstanding success driven by exceptional market performance as we created sustainable value. Weatherford now stands distinguished by its financial prudence, proven performance, and intensified operational focus. In this new era, our focus on profitable expansion, optimized cash flow conversion, and industry-leading returns is evident, underscoring our dedication. Concurrently, our unwavering commitment to customer service, which fosters shareholder value, remains fundamental to our strength.

Over the past few years, our efforts have been focused on turning around the Company, addressing operational issues, and improving processes intensely. This is a journey I am incredibly excited about. 2023 marked a distinct shift towards tangible value creation, signifying a new growth phase for Weatherford. In addition to continuing to refine our work from the prior years, we are committed to adding muscle to inorganic planning, heightening technology innovation, and expanding our commercial solutions bandwidth. This commitment to continuous improvement is a testament to our confidence in the future.

2023 Financial Performance Highlights

The year signified the achievement of four consecutive years of positive free cash flow generation for our Company. What was once viewed as seemingly impossible for Weatherford is now a basic reality that we are determined to maintain. Our financial performance was also characterized by another year of significant margin expansion and several commercial awards. Our inclusion in market indices like the S&P Midcap 400, the OIH, and the OSX, serves as a testament to our increased valuation and sector relevance. Additionally, through our improved operating performance, we have successfully and significantly decreased our gross debt and received several significant credit ratings and upgrades.

• Full-year revenue of $5,135 million, increased 19% from the prior year, driven by international revenue growth of 26%
• Full-year operating income of $820 million, increased 99% from the prior year
• Full-year net income of $417 million, an 8.1% net income margin, increased by 1,504% from the prior year – second consecutive year of positive net income – the first time in over 14 years and the highest level since 2008 (excluding the gain from bankruptcy emergence)
• Full-year adjusted EBITDA* of $1,186 million, a 23.1% adjusted EBITDA margin,* increased 45% and 423 basis points from the prior year – highest full-year adjusted EBITDA margins* in over 15 years
• Full-year cash provided by operating activities of $832 million and adjusted free cash flow* of $651 million – generated >$1.3 billion of adjusted free cash flow* over the last 4 years
• Net leverage ratio* of 0.7x, our lowest level in over 15 years
• $519 million of debt reduction through January 2024
• Top tier return on invested capital ROIC* of 27.2% in 2023
• Announced a $550 million credit facility with a $300 million borrowing capacity and a five-year maturity
• Received credit rating upgrades from S&P Global Ratings to ‘B+’ (with a positive outlook) and Moody’s to ‘B1’ (with a positive outlook); newly initiated Fitch Ratings of ‘B+’

*This is a non-GAAP financial measure. Please refer to the appendix below included herein for a reconciliation of GAAP to the non-GAAP financial measures.

Our Strategic Priorities

In 2023, we built upon our earlier emphasis on Fulfillment, Directed Growth, Execution Excellence, and Simplification by formalizing our Strategic Priorities. These priorities—Financial Performance, Organizational Vitality, LEAN Operations, Customer Experience, and Creating the Future—now serve as a guide for our operating rhythm and initiatives for the foreseeable future. Our organization has fully embraced these priorities, and their impact is increasingly evident, yielding consistent and significant results quarter after quarter.

I look forward to sharing more details on our progress in these areas throughout this update. While we've effectively showcased our ability to meet these priorities, we understand that our journey is one of continuous improvement. Our unwavering dedication remains centered on fortifying the core pillars of Safety, Quality, and Compliance. Our foundation must remain robust, capable of supporting our targeted growth, and flexible enough to scale as necessary.

Innovation and Technology Differentiation

When deciding to join Weatherford in 2020, one of the most appealing aspects was the technology portfolio and opportunities to extract significant value with the proper focus. Since then, we have carefully considered our investment decisions to ensure we provide products and services that differentiate Weatherford and provide meaningful value for our customers. In 2022, we unveiled a new Company moniker, The Energy of Innovation®, that encapsulates the spirit of ingenuity the One Weatherford team demonstrates across the enterprise.

In 2023, we continued to drive innovation in several of our market-leading product lines, such as Tubular Running Services with the launch of StringGuard^™, Managed Pressure Drilling with the launch of Modus^™, and Intervention Services with the launch of the MultiCatch^™ anchor and GhostReamer^™. In addition, we continued to advance our efforts to provide sustainable solutions to our customers on global projects to aid in decarbonization, operational efficiency, and advanced control initiatives through our ESG and Digital capabilities. Throughout the year, we also announced projects and partnerships with industry leaders, such as Eavor, an advanced geothermal technology company dedicated to creating a clean, scalable form of baseload power globally, and Honeywell to provide a comprehensive emissions management solution for the energy industry. More details on our innovative technologies are included in this update.

Creating the Future

Entering 2024, Weatherford has undergone a significant transformation, distinctly different not only from its past but also from the sector. Embracing a forward-thinking approach, we are actively shaping a purpose-driven, streamlined, and capital-efficient organization, prioritizing technological innovation and operational prowess as we continue to deliver sustainable profitability and free cash flow generation. My confidence in the One Weatherford team and our ability to perform and deliver has never been higher. Weatherford is now a reimagined entity, strategically poised for success in the evolving landscape.