# EDGAR Filing Document

**Accession Number:** 0001958086
**File Stem:** 0000950170-25-098473
**Filing Date:** 2025-7
**Character Count:** 142235
**Document Hash:** 39d4559393364458f98adfe34c1a69f5
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000950170-25-098473.hdr.sgml**: 20250725

**ACCESSION NUMBER**: 0000950170-25-098473

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 72

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250725

**DATE AS OF CHANGE**: 20250724

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Core Laboratories Inc. /DE/
- **CENTRAL INDEX KEY:** 0001958086
- **STANDARD INDUSTRIAL CLASSIFICATION:** OIL, GAS FIELD SERVICES, NBC [1389]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41695
- **FILM NUMBER:** 251148116

**BUSINESS ADDRESS:**
- **STREET 1:** 6316 WINDFERN ROAD
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77040
- **BUSINESS PHONE:** 713-328-2673

**MAIL ADDRESS:**
- **STREET 1:** 6316 WINDFERN ROAD
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77040

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Core Laboratories Luxembourg S.A.
- **DATE OF NAME CHANGE:** 20221213

?xml version='1.0' encoding='ASCII'? 10-Q

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM** 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

**For the quarterly period ended** **June 30,** 2025

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to ______________

Commission File Number: 001-41695

CORE LABORATORIES INC.

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| Delaware | 98-1164194 |
| (State or other jurisdiction of<br>incorporation or organization) | (I.R.S. Employer Identification No.) |
| 6316 Windfern Road |  |
| Houston**,** TX | 77040 |
| (Address of principal executive offices) | (Zip Code) |

---

**(**713**)** 328-2673

(Registrant's telephone number, including area code)

**None**

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

---

| | |
|:---|:---|
| **Title of each class** | **Name of each exchange on which registered** |
| Common Stock (par value $0.01)<br> CLB | New York Stock Exchange |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ <br>

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of common stock of the registrant, par value $0.01 per share, outstanding at July 18, 2025 was 46,893,842.

------

**CORE LABORATORIES INC.**

**FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2025**

**INDEX**

**PART I - FINANCIAL INFORMATION**

---

| | | |
|:---|:---|:---|
|  |  | **Page** |
| [<u>Item 1.</u>](#item_1_financial_statements) | [<u>Financial Statements</u>](#item_1_financial_statements) |  |
|  | [<u>Consolidated Balance Sheets at June 30, 2025 (Unaudited) and December 31, 2024</u>](#consolidated_balance_sheets) | 3 |
|  | [<u>Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024</u>](#consolidated_statements_operation3mths)[<u>(Unaudited)</u>](#consolidated_statements_operation3mths) | 4 |
|  | [<u>Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2025 and 2024 (</u>](#consolidated_statements_comprehensive_in)[<u>Unaudited)</u>](#consolidated_statements_comprehensive_in) | 6 |
|  | [<u>Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2025 and 2024</u>](#consolidated_statements_equity)[<u>(Unaudited)</u>](#consolidated_statements_equity) | 7 |
|  | [<u>Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024</u>](#consolidated_statements_cash_flows)[<u>(Unaudited)</u>](#consolidated_statements_cash_flows) | 9 |
|  | [<u>Notes to the Interim Consolidated Financial Statements (Unaudited)</u>](#notes_to_unaudited_consolidated_interim_) | 10 |
| [<u>Item 2.</u>](#item_2_managements_discussion_analysis_f) | [<u>Management's Discussion and Analysis of Financial Condition and Results of Operations</u>](#item_2_managements_discussion_analysis_f) | 22 |
| [<u>Item 3.</u>](#item_3__quantitative_and_qualitative_dis) | [<u>Quantitative and Qualitative Disclosures About Market Risk</u>](#item_3__quantitative_and_qualitative_dis) | 35 |
| [<u>Item 4.</u>](#item_4__controls_and_procedures) | [<u>Controls and Procedures</u>](#item_4__controls_and_procedures) | 35 |
| **PART II - OTHER INFORMATION** | **PART II - OTHER INFORMATION** | **PART II - OTHER INFORMATION** |
| [<u>Item 1.</u>](#item_1_legal_proceedings) | [<u>Legal Proceedings</u>](#item_1_legal_proceedings) | 36 |
| [<u>Item 1A.</u>](#item_1a_risk_factors) | [<u>Risk Factors</u>](#item_1a_risk_factors) | 36 |
| [<u>Item 2.</u>](#item_2_unregistered_sales_equity_securit) | [<u>Unregistered Sales of Equity Securities and Use of Proceeds</u>](#item_2_unregistered_sales_equity_securit) | 37 |
| [<u>Item 5.</u>](#item_5_other_info) | [<u>Other Information</u>](#item_5_other_info) | 37 |
| [<u>Item 6.</u>](#item_6_exhibits) | [<u>Exhibits</u>](#item_6_exhibits) | 38 |
|  | [<u>Signature</u>](#signature) | 39 |

---

------

**PART I - FINANCIAL INFORMATION**

**Item 1. Financial Statements**

**CORE LABORATORIES INC.**

**CONSOLIDATED BALANCE SHEETS**

**(In thousands, except share and per share data)**

---

| | | |
|:---|:---|:---|
|  | **June 30,<br>2025** | **December 31,<br>2024** |
|  | **(Unaudited)** |  |
| **ASSETS** |  |  |
| CURRENT ASSETS: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $31188 | $19157 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net of allowance for credit losses <br>&nbsp;&nbsp;&nbsp;&nbsp; of $4,599 and $3,192 at 2025 and 2024, respectively | 113909 | 111761 |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventories | 59773 | 59402 |
| &nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses | 10516 | 10176 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income taxes receivable | 14043 | 15594 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 8248 | 10516 |
| TOTAL CURRENT ASSETS | 237677 | 226606 |
| PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation <br>&nbsp;&nbsp;&nbsp;&nbsp; of $319,265 and $314,317 at 2025 and 2024, respectively | 97927 | 97063 |
| RIGHT OF USE ASSETS | 55116 | 56488 |
| INTANGIBLES, net of accumulated amortization and impairment <br>&nbsp;&nbsp;&nbsp;&nbsp; of $19,405 and $19,326 at 2025 and 2024, respectively | 6170 | 6403 |
| GOODWILL | 99996 | 99445 |
| DEFERRED TAX ASSETS, net | 70479 | 69613 |
| OTHER ASSETS | 34746 | 34788 |
| TOTAL ASSETS | $602111 | $590406 |
| **LIABILITIES AND EQUITY** |  |  |
| CURRENT LIABILITIES: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | $41699 | $34549 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued payroll and related costs | 25319 | 22901 |
| &nbsp;&nbsp;&nbsp;&nbsp;Taxes other than payroll and income | 3623 | 7106 |
| &nbsp;&nbsp;&nbsp;&nbsp;Unearned revenues | 9115 | 9332 |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | 11508 | 10690 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income taxes payable | 4385 | 4851 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other current liabilities | 9123 | 8157 |
| TOTAL CURRENT LIABILITIES | 104772 | 97586 |
| LONG-TERM DEBT, net | 124613 | 126111 |
| LONG-TERM OPERATING LEASE LIABILITIES | 42420 | 43343 |
| DEFERRED COMPENSATION | 29639 | 31115 |
| DEFERRED TAX LIABILITIES, net | 11482 | 13783 |
| OTHER LONG-TERM LIABILITIES | 21882 | 20732 |
| COMMITMENTS AND CONTINGENCIES |  |  |
| EQUITY: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Preference stock, 6,000,000 shares authorized, $0.01 par value; <br>none issued or outstanding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock, 200,000,000 shares authorized, $0.01 par value,<br> 46,966,868 issued and 46,536,790 outstanding at 2025; 46,966,868 issued and 46,826,820 outstanding at 2024 | 470 | 470 |
| &nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 112763 | 109547 |
| &nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | 159824 | 150280 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive income (loss) | (5957) | (5769) |
| &nbsp;&nbsp;&nbsp;&nbsp;Treasury stock (at cost), 430,078 and 140,048 shares at 2025 and 2024, respectively | (5817) | (2537) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Core Laboratories Inc. shareholders' equity | 261283 | 251991 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest | 6020 | 5745 |
| TOTAL EQUITY | 267303 | 257736 |
| TOTAL LIABILITIES AND EQUITY | $602111 | $590406 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(In thousands, except per share data)**

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** |
|  | **June 30,** | **June 30,** |
|  | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** |
| REVENUE: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services | $96219 | $96337 |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | 33940 | 34240 |
| Total revenue | 130159 | 130577 |
| OPERATING EXPENSES: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services, exclusive of depreciation expense shown below | 74053 | 74823 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of product sales, exclusive of depreciation expense shown below | 29648 | 28107 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense, exclusive of depreciation expense shown below | 10464 | 10259 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 3561 | 3643 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization | 109 | 127 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (income) expense, net | (2967) | (2390) |
| OPERATING INCOME | 15291 | 16008 |
| Interest expense | 2711 | 3209 |
| Income before income taxes | 12580 | 12799 |
| Income tax expense | 1911 | 3609 |
| Net income | 10669 | 9190 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 33 | 158 |
| Net income attributable to Core Laboratories Inc. | $10636 | $9032 |
| EARNINGS PER SHARE INFORMATION: |  |  |
| Basic earnings per share | $0.23 | $0.20 |
| Basic earnings per share attributable to Core Laboratories Inc. | $0.23 | $0.19 |
| Diluted earnings per share | $0.23 | $0.19 |
| Diluted earnings per share attributable to Core Laboratories Inc. | $0.22 | $0.19 |
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |  |  |
| Basic | 46632 | 46908 |
| Diluted | 47364 | 47743 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(In thousands, except per share data)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** |
|  | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** |
| REVENUE: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services | $191310 | $192832 |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | 62434 | 67382 |
| Total revenue | 253744 | 260214 |
| OPERATING EXPENSES: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services, exclusive of depreciation expense shown below | 147033 | 148688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of product sales, exclusive of depreciation expense shown below | 56137 | 58830 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense, exclusive of depreciation expense shown below | 24111 | 22048 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 7154 | 7358 |
| &nbsp;&nbsp;&nbsp;&nbsp;Amortization | 233 | 255 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (income) expense, net | (632) | (1544) |
| OPERATING INCOME | 19708 | 24579 |
| Interest expense | 5313 | 6632 |
| Income before income taxes | 14395 | 17947 |
| Income tax expense | 3657 | 5267 |
| Net income | 10738 | 12680 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 256 | 428 |
| Net income attributable to Core Laboratories Inc. | $10482 | $12252 |
| EARNINGS PER SHARE INFORMATION: |  |  |
| Basic earnings per share | $0.23 | $0.27 |
| Basic earnings per share attributable to Core Laboratories Inc. | $0.22 | $0.26 |
| Diluted earnings per share | $0.23 | $0.26 |
| Diluted earnings per share attributable to Core Laboratories Inc. | $0.22 | $0.26 |
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: |  |  |
| Basic | 46702 | 46884 |
| Diluted | 47509 | 47662 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME**

**(In thousands)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Net income | $10669 | $9190 | $10738 | $12680 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other comprehensive income (loss): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swaps: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest rate swap amount reclassified to net income | (162) | (248) | (382) | (545) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax benefit on interest rate swaps reclassified to net income | 33 | 52 | 80 | 114 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest rate swaps | (129) | (196) | (302) | (431) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pension and other postretirement benefit plans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of actuarial gain reclassified to net income | 78 | 64 | 155 | 128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax expense on pension and other postretirement benefit plans reclassified to net income | (20) | (17) | (41) | (34) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total pension and other postretirement benefit plans | 58 | 47 | 114 | 94 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total other comprehensive income (loss) | (71) | (149) | (188) | (337) |
| Comprehensive income | 10598 | 9041 | 10550 | 12343 |
| &nbsp;&nbsp;&nbsp;&nbsp;Comprehensive income attributable to non-controlling interest | 33 | 158 | 256 | 428 |
| Comprehensive income attributable to Core Laboratories Inc. | $10565 | $8883 | $10294 | $11915 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY**

**(In thousands, except share and per share data)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| **Common Stock** |  |  |  |  |
| Balance at Beginning of Period | $470 | $469 | $470 | $469 |
| Balance at End of Period | $470 | $469 | $470 | $469 |
| **Additional Paid-In Capital** |  |  |  |  |
| Balance at Beginning of Period | $113574 | $114642 | $109547 | $110011 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | (811) | (1163) | 3216 | 3468 |
| Balance at End of Period | $112763 | $113479 | $112763 | $113479 |
| **Retained Earnings** |  |  |  |  |
| Balance at Beginning of Period | $149657 | $123508 | $150280 | $120756 |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends paid | (469) | (470) | (938) | (938) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to Core Laboratories Inc. | 10636 | 9032 | 10482 | 12252 |
| Balance at End of Period | $159824 | $132070 | $159824 | $132070 |
| **Accumulated Other Comprehensive Income (Loss)** |  |  |  |  |
| Balance at Beginning of Period | $(5886) | $(5160) | $(5769) | $(4972) |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate swaps, net of income taxes | (129) | (196) | (302) | (431) |
| &nbsp;&nbsp;&nbsp;&nbsp;Pension and other postretirement benefit plans, net of income taxes | 58 | 47 | 114 | 94 |
| Balance at End of Period | $(5957) | $(5309) | $(5957) | $(5309) |
| **Treasury Stock** |  |  |  |  |
| Balance at Beginning of Period | $(4427) | $(1304) | $(2537) | $(1449) |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 1350 | 1031 | 1481 | 1220 |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (2740) | (162) | (4761) | (206) |
| Balance at End of Period | $(5817) | $(435) | $(5817) | $(435) |
| **Non-Controlling Interest** |  |  |  |  |
| Balance at Beginning of Period | $5968 | $5262 | $5745 | $4992 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest contribution | $19 | $— | $19 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 33 | 158 | 256 | 428 |
| Balance at End of Period | $6020 | $5420 | $6020 | $5420 |
| **Total Equity** |  |  |  |  |
| Balance at Beginning of Period | $259356 | $237417 | $257736 | $229807 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 539 | (132) | 4697 | 4688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest contribution | 19 |  | 19 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividends paid | (469) | (470) | (938) | (938) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income | 10669 | 9190 | 10738 | 12680 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest rate swaps, net of income taxes | (129) | (196) | (302) | (431) |
| &nbsp;&nbsp;&nbsp;&nbsp;Pension and other postretirement benefit plans, net of income taxes | 58 | 47 | 114 | 94 |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (2740) | (162) | (4761) | (206) |
| Balance at End of Period | $267303 | $245694 | $267303 | $245694 |
| **Cash Dividends per Share** | $**0.01** | $**0.01** | $**0.02** | $**0.02** |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Continued)**

**(In thousands, except share and per share data)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| **Common Stock - Number of shares issued** |  |  |  |  |
| Balance at Beginning of Period | 46966868 | 46938557 | 46966868 | 46938557 |
| Balance at End of Period | 46966868 | 46938557 | 46966868 | 46938557 |
| **Treasury Stock - Number of shares** |  |  |  |  |
| Balance at Beginning of Period | (264676) | (74191) | (140048) | (82021) |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 72230 | 58396 | 79200 | 69071 |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (237632) | (10067) | (369230) | (12912) |
| Balance at End of Period | (430078) | (25862) | (430078) | (25862) |
| **Common Stock - Number of shares outstanding** |  |  |  |  |
| Balance at Beginning of Period | 46702192 | 46864366 | 46826820 | 46856536 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 72230 | 58396 | 79200 | 69071 |
| &nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (237632) | (10067) | (369230) | (12912) |
| Balance at End of Period | 46536790 | 46912695 | 46536790 | 46912695 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(In thousands)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** |
|  | **2025** | **2024** |
|  | **(Unaudited)** | **(Unaudited)** |
| CASH FLOWS FROM OPERATING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Net income | $10738 | $12680 |
| &nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating activities: | &nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating activities: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 4697 | 4688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 7387 | 7613 |
| &nbsp;&nbsp;&nbsp;&nbsp;Assets write-down | 34 | 1110 |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventory write-off and obsolescence | 1620 | 499 |
| &nbsp;&nbsp;&nbsp;&nbsp;Provision for credit losses | 1603 | 727 |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in value of life insurance policies | (834) | (2185) |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | (3167) | (777) |
| &nbsp;&nbsp;&nbsp;&nbsp;Insurance recovery on property, plant and equipment | (1557) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-cash items | 566 | (282) |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (3717) | (7019) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (1991) | 1305 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (817) | (3976) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | (109) | 306 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 6647 | 3116 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | (886) | 4100 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unearned revenues | (218) | 745 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 587 | 26 |
| Net cash provided by operating activities | 20583 | 22676 |
| CASH FLOWS FROM INVESTING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Capital expenditures - operations | (6259) | (5918) |
| &nbsp;&nbsp;Capital expenditures - rebuilding of Aberdeen facility | (1648) |  |
| &nbsp;&nbsp;Proceeds from insurance recovery - Aberdeen facility | 4678 |  |
| &nbsp;&nbsp;Patents and other intangibles |  | (3) |
| &nbsp;&nbsp;Acquisitions, net of cash acquired | (617) |  |
| &nbsp;&nbsp;Proceeds from sale of assets | 2196 | 801 |
| &nbsp;&nbsp;Net proceeds on life insurance policies | 778 | 2776 |
| Net cash used in investing activities | (872) | (2344) |
| CASH FLOWS FROM FINANCING ACTIVITIES: |  |  |
| &nbsp;&nbsp;Repayment of long-term debt | (27000) | (38000) |
| &nbsp;&nbsp;Proceeds from long-term debt | 25000 | 22000 |
| &nbsp;&nbsp;Dividends paid | (938) | (938) |
| &nbsp;&nbsp;Repurchase of common stock | (4761) | (206) |
| &nbsp;&nbsp;Equity related transaction costs |  | (594) |
| &nbsp;&nbsp;Other financing activity | 19 | (19) |
| Net cash used in financing activities | (7680) | (17757) |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | 12031 | 2575 |
| CASH AND CASH EQUIVALENTS, beginning of period | 19157 | 15120 |
| CASH AND CASH EQUIVALENTS, end of period | $31188 | $17695 |
| Supplemental disclosures of cash flow information: |  |  |
| &nbsp;&nbsp;Cash payments for interest | $4065 | $5799 |
| &nbsp;&nbsp;Cash payments for income taxes | $4874 | $6210 |
| Non-cash investing and financing activities: |  |  |
| &nbsp;&nbsp;Capital expenditures incurred but not paid for as of the end of the period | $819 | $1358 |
| &nbsp;&nbsp;Equity related transaction costs incurred but not paid for as of the end of the period | $— | $162 |

---

The accompanying notes are an integral part of these interim consolidated financial statements.

[<u>Return to Index</u>](#index)

------

**CORE LABORATORIES INC.**

**NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**

**1. DESCRIPTION OF BUSINESS** 

References to "Core Lab", "Core Laboratories", the "Company", "we", "our" and similar phrases are used throughout this Quarterly Report on Form 10-Q ("Quarterly Report") and relate collectively to Core Laboratories Inc. and its consolidated subsidiaries.

We operate our business in two segments: (1) Reservoir Description and (2) Production Enhancement. These complementary operating segments provide different services and products and utilize different technologies for evaluating and improving reservoir performance and increasing oil and gas recovery from new and existing fields. For a description of the types of services and products offered by these operating segments, see Note 16 - S*egment Reporting*.

**2. SIGNIFICANT ACCOUNTING POLICIES UPDATE**

***Basis of Presentation and Principles of Consolidation***

The accompanying unaudited interim consolidated financial statements include the accounts of Core Laboratories Inc. and its subsidiaries for which we have a controlling voting interest and/or a controlling financial interest. These financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles ("U.S. GAAP") for interim financial information using the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements do not include all of the information and footnote disclosures required by U.S. GAAP for the annual financial statements and should be read in conjunction with the audited financial statements and notes thereto included in Core Laboratories Inc.'s Annual Report on Form 10-K for the year ended December 31, 2024, including Note 2 - *Summary of Significant Accounting Policies.* Core Laboratories Inc.'s balance sheet information for the year ended December 31, 2024, was derived from the 2024 audited consolidated financial statements. There have been no changes to the accounting policies during the six months ended June 30, 2025.

Core Laboratories Inc. uses the equity method of accounting for investments in which it has less than a majority interest and does not exercise control but does exert significant influence. Non-controlling interests have been recorded to reflect outside ownership attributable to consolidated subsidiaries that are less than 100% owned. All inter-company transactions and balances have been eliminated in consolidation.

In the opinion of management, all adjustments considered necessary for a fair statement of the results for the interim periods presented have been included in these financial statements. Furthermore, the operating results presented for the three and six months ended June 30, 2025, may not necessarily be indicative of the results that may be expected for the year ending December 31, 2025.

Certain reclassifications were made to prior period amounts in order to conform to the current period presentations. These reclassifications had no impact on the reported net income or cash flows for the three and six months ended June 30, 2024.

***Property, Plant and Equipment***

We review our long-lived assets ("LLA") for impairment when events or changes in circumstances indicate that their net book value may not be recovered over their remaining service lives. Indicators of possible impairment may include significant declines in activity levels in regions where specific assets or groups of assets are located, extended periods of idle use, declining revenue or cash flow or overall changes in general market conditions.

The geopolitical conflict between Russia and Ukraine, which began in February 2022 and has continued through June 30, 2025, has resulted in disruptions to our operations in Russia and Ukraine. As of June 30, 2025, our laboratory facilities, offices, and locations in Russia and Ukraine continued to operate with no significant impact to local business operations. Therefore, we

[<u>Return to Index</u>](#index)

------

determined there was no triggering event for LLA in Russia and Ukraine, and no impairment assessments have been performed as of June 30, 2025.

***Recent Accounting Pronouncements*** 

*Issued But Not Yet Effective* 

In December 2023, FASB issued ASU 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures to improve transparency of income tax disclosures, primarily by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. The amendment is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendment should be applied prospectively; however, retrospective application is permitted. Upon adoption, our disclosures regarding income taxes will be expanded accordingly.

In November 2024, FASB issued ASU 2024-03 Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) to improve disclosures about a public business entity's expenses, by providing more detailed information about the types of expenses in commonly presented expense captions. As amended by ASU 2025-01 issued in January 2025, the amendment is effective for annual periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendment may be applied prospectively or retrospectively. Upon adoption, our disclosures regarding expenses will be expanded.

**3. ACQUISITIONS AND DIVESTURES**

We had no significant business acquisitions or divestures during the three and six months ended June 30, 2025 and 2024.

**4. CONTRACT ASSETS AND LIABILITIES**

The balance of contract assets and liabilities consisted of the following (in thousands):

---

| | | |
|:---|:---|:---|
|  | **June 30,<br>2025** | **December 31,<br>2024** |
| Contract assets: |  |  |
| &nbsp;&nbsp;Current | $246 | $370 |
|  | $246 | $370 |
| Contract liabilities: |  |  |
| &nbsp;&nbsp;Current | $548 | $560 |
|  | $548 | $560 |

---

---

| | |
|:---|:---|
|  | **June 30,<br>2025** |
| Estimate of when contract liabilities will be recognized as revenue: |  |
| &nbsp;&nbsp;Within 12 months | $548 |

---

The current portion of contract assets is included in our accounts receivable. The current portion of contract liabilities is included in unearned revenues and, as applicable, the non-current portion of contract liabilities is included in other long-term liabilities.

We did not recognize any impairment losses on our contract assets during the three and six months ended June 30, 2025 and 2024.

[<u>Return to Index</u>](#index)

------

**5. INVENTORIES**

Inventories consist of the following (in thousands):

---

| | | |
|:---|:---|:---|
|  | **June 30,<br>2025** | **December 31,<br>2024** |
| Finished goods | $28316 | $27127 |
| Parts and materials | 28542 | 28953 |
| Work in progress | 2915 | 3322 |
| &nbsp;&nbsp; Total inventories | $59773 | $59402 |

---

We include freight costs incurred for shipping inventory to our clients in the cost of product sales caption in the accompanying consolidated statements of operations.

**6. LEASES**

We have operating leases primarily consisting of office and lab space, machinery and equipment and vehicles. We entered into a sublease agreement in 2023 that was terminated at the beginning of 2025, for existing office and lab space in Calgary, Alberta, Canada.

The components of lease expense and other information are as follows (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Consolidated Statements of Operations:** |  |  |  |  |
| Operating lease expense | $4168 | $4364 | $8346 | $8646 |
| Short-term lease expense | 392 | 285 | 881 | 837 |
| Variable lease expense | 378 | 391 | 859 | 820 |
| Sublease income |  | (56) |  | (113) |
| &nbsp;&nbsp;&nbsp;&nbsp; Total lease expense | $4938 | $4984 | $10086 | $10190 |
| **Consolidated Statements of Cash Flows:** |  |  |  |  |
| &nbsp;&nbsp; Operating cash flows - operating leases payments | $4689 | $4631 | $8895 | $8909 |
| &nbsp;&nbsp; Right of use assets obtained (released) in exchange for<br>operating lease obligations | $721 | $2182 | $4876 | $6959 |
| **Other information:** |  |  |  |  |
| &nbsp;&nbsp; Weighted-average remaining lease term - operating leases | 8.36 years | 8.62 years | 8.36 years | 8.62 years |
| &nbsp;&nbsp; Weighted-average discount rate - operating leases | 5.47% | 5.33% | 5.47% | 5.33% |

---

Scheduled undiscounted lease payments for non-cancellable operating leases consist of the following (in thousands):

---

| | |
|:---|:---|
|  | **June 30, 2025** |
|  | **Operating Leases** |
| Remainder of 2025 | $7204 |
| 2026 | 12193 |
| 2027 | 9584 |
| 2028 | 7471 |
| 2029 | 5062 |
| Thereafter | 26187 |
| &nbsp;&nbsp;Total undiscounted lease payments | 67701 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less: Imputed interest | (13773) |
| &nbsp;&nbsp;Total operating lease liabilities | $53928 |

---

[<u>Return to Index</u>](#index)

------

**7. LONG-TERM DEBT, NET**

We have no finance lease obligations. Debt is summarized in the following table (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Interest Rate** | **Maturity Date** | **June 30,<br>2025** | **December 31,<br>2024** |
| Credit Facility |  |  | $16000 | $18000 |
| 2021 Senior Notes Series A <sup>(1)</sup> | 4.09% | January 12, 2026 | 45000 | 45000 |
| 2021 Senior Notes Series B <sup>(1)</sup> | 4.38% | January 12, 2028 | 15000 | 15000 |
| 2023 Senior Notes Series A <sup>(2)</sup> | 7.25% | June 28, 2028 | 25000 | 25000 |
| 2023 Senior Notes Series B <sup>(2)</sup> | 7.50% | June 28, 2030 | 25000 | 25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total long-term debt |  |  | 126000 | 128000 |
| Less: Debt issuance costs |  |  | (1387) | (1889) |
| &nbsp;&nbsp;&nbsp;&nbsp;Long-term debt, net |  |  | $124613 | $126111 |

---

&nbsp;&nbsp;&nbsp;&nbsp;*(1) Interest is payable semi-annually on June 30 and December 30.*

&nbsp;&nbsp;&nbsp;&nbsp;*(2) Interest is payable semi-annually on March 28 and September 28.*

As of June 30, 2025, we, along with Core Laboratories (U.S.) Interests Holdings, Inc. ("CLIH"), have a credit facility, the Eighth Amended and Restated Credit Agreement (as amended, the "Credit Facility") for an aggregate borrowing commitment of $135.0 million with a $50.0 million "accordion" feature.

On July 22, 2025, we entered into the Ninth Amended and Restated Credit Agreement (as amended, the "Renewed Credit Facility") for an aggregate borrowing commitment of $150.0 million with a $50.0 million "accordion" feature. Draws up to $100.0 million are available in the form of a revolving credit facility, and a single draw of $50.0 million is available in the form of a delayed draw term loan ("DDTL") through January 12, 2026. The DDTL is repayable in quarterly installments of $625 thousand and prepayments are permitted without penalty. Any remaining outstanding balance under the revolving credit facility and the DDTL is due at maturity on July 22, 2029, subject to springing maturity dates unless the Company's liquidity equals or exceeds the principal amount of each of the respective senior notes series that remain outstanding on each of the respective springing maturity dates as follows:

1) October 17, 2027, if any portion of the Company's 2021 Senior Notes Series B due January 12, 2028, in the aggregate principal amount of $15.0 million, remains outstanding on October 17, 2027, and

2) March 28, 2028, if any portion of the Company's 2023 Senior Notes Series A due June 28, 2028, in the aggregate principal amount of $25.0 million, remains outstanding on March 28, 2028.

There are no significant changes to other terms, including assets securing the debt, interest rates, and cross default provisions associated with the Senior Notes, financial covenants or the interest coverage and leverage ratios as described below.

The Credit Facility is secured by first priority interests in (1) substantially all of the tangible and intangible personal property, and equity interest of CLIH and certain of the Company's U.S. and foreign subsidiary companies and (2) instruments evidencing intercompany indebtedness owing to the Company, CLIH and certain of the Company's U.S. and foreign subsidiary companies. Certain of our significant, wholly owned subsidiaries are guarantors or co-borrowers under the Credit Facility and Senior Notes.

Under the Credit Facility, the Secured Overnight Financing Rate ("SOFR") plus 2.00% to SOFR plus 3.00% will be applied to outstanding borrowings. Any outstanding balance under the Credit Facility is due at maturity on July 25, 2026, subject to springing maturity on July 12, 2025, if any portion of the Company's 2021 Senior Notes Series A due January 12, 2026, in the aggregate principal amount of $45.0 million, remain outstanding on July 12, 2025, unless the Company's liquidity equals or exceeds the principal amount of the 2021 Senior Notes Series A that remained outstanding on such date. On July 12, 2025, our liquidity exceeded the outstanding principal amount of the 2021 Senior Notes Series and no springing maturity occurred. The available capacity at any point in time is reduced by outstanding borrowings and outstanding letters of credit which totaled approximately $10.7 million at June 30, 2025, resulting in an available borrowing capacity under the Credit Facility of

[<u>Return to Index</u>](#index)

------

approximately $108.3 million. In addition to indebtedness under the Credit Facility, we had approximately $7.7 million of outstanding letters of credit and performance guarantees and bonds from other sources as of June 30, 2025.

The Credit Facility and Senior Notes include a cross-default provision, whereby a default under one agreement may trigger a default in the other agreements.

The terms of the Credit Facility and Senior Notes require us to meet certain covenants, including, but not limited to, an interest coverage ratio (calculated as consolidated EBITDA divided by interest expense) and a leverage ratio (calculated as consolidated net indebtedness divided by consolidated EBITDA), where consolidated EBITDA (as defined in each agreement) and interest expense are calculated using the most recent four fiscal quarters. The Credit Facility has more restrictive covenants with a minimum interest coverage ratio of 3.00 to 1.00 and permits a maximum leverage ratio of 2.50 to 1.00. The Credit Facility allows non-cash charges such as impairment of assets, stock compensation and other non-cash charges to be added back in the calculation of consolidated EBITDA. The terms of our Credit Facility also allow us to negotiate in good faith to amend any ratio or requirement to preserve the original intent of the agreement if any change in accounting principles would affect the computation of any financial ratio or covenant of the Credit Facility. In accordance with the terms of the Credit Facility, our leverage ratio is 1.27 and our interest coverage ratio is 7.22, each for the period ended June 30, 2025. We are in compliance with all covenants contained in our Credit Facility and Senior Notes as of June 30, 2025.

We, along with CLIH as issuer, have senior notes outstanding that were issued through private placement transactions. Series A and Series B of the 2021 Senior Notes were issued in 2021 (the "2021 Senior Notes"). Series A and Series B of the 2023 Senior Notes were issued in 2023 (the "2023 Senior Notes"). The 2021 Senior Notes and the 2023 Senior Notes are collectively the "Senior Notes". We intend to repay the 2021 Senior Notes Series A at maturity in January 2026 using borrowings under our Renewed Credit Facility; therefore, we continue to classify them as long-term debt.

See Note 11 - *Derivative Instruments and Hedging Activities* for additional information regarding interest rate swap agreements we have entered to fix the underlying risk-free rate on our Credit Facility and Senior Notes.

The estimated fair value of total debt at June 30, 2025 and December 31, 2024, approximated the book value of total debt. The fair value was estimated using Level 2 inputs by calculating the sum of the discounted future interest and principal payments through the maturity date.

**8. PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS**

Prior to January 2020, one of our subsidiaries provided a noncontributory defined benefit pension plan covering substantially all of our Dutch employees ("Dutch Plan") who were hired prior to 2000. This pension benefit was based on years of service and final pay or career average pay, depending on when the employee began participating. The Dutch Plan was curtailed prior to January 2020, and these employees have been moved into the Dutch defined contribution plan. However, the unconditional indexation for this group of participants continues for so long as they remain in active service with the Company.

The following table summarizes the components of net periodic pension cost under the Dutch Plan (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Interest cost | $373 | $348 | $720 | $702 |
| Expected return on plan assets | (301) | (287) | (581) | (577) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net periodic pension cost | $72 | $61 | $139 | $125 |

---

[<u>Return to Index</u>](#index)

------

**9. COMMITMENTS AND CONTINGENCIES**

We have been and may, from time to time, be named as a defendant in legal actions that arise in the ordinary course of business. These include, but are not limited to, employment-related claims and contractual disputes or claims for personal injury or property damage which occur in connection with the provision of our services and products. A liability is accrued when a loss is both probable and can be reasonably estimated.

See Note 7 - *Long-term Debt, net* for amounts committed under letters of credit and performance guarantees and bonds.

**10. EQUITY**

***Treasury Stock***

During the three and six months ended June 30, 2025, we distributed 72,230 and 79,200 shares, respectively, of treasury stock upon vesting of stock-based awards. During the three and six months ended June 30, 2025, we repurchased 237,632 and 369,230 shares, respectively, of our common stock for $2.7 million and $4.8 million, respectively. The total repurchased shares include rights which were surrendered to us pursuant to the terms of a stock-based compensation plan in consideration of the participant's tax burdens resulting from the issuance of common stock under that plan. Rights surrendered to us were 10,331 and 12,454 shares valued at $136 thousand and $168 thousand for the three and six months ended June 30, 2025, respectively. Such shares of common stock, unless canceled, may be reissued for a variety of purposes such as future acquisitions, non-employee director stock awards or employee stock awards.

***Dividend Policy***

In March and May 2025, we paid a quarterly cash dividend of $0.01 per share of common stock. In addition, on July 23, 2025, we declared a quarterly cash dividend of $0.01 per share of common stock for shareholders of record on August 4, 2025, and payable on August 25, 2025.

***Accumulated Other Comprehensive Income (Loss)***

Amounts recognized, net of income tax, in accumulated other comprehensive income (loss) consist of the following (in thousands):

---

| | | |
|:---|:---|:---|
|  | **June 30,<br>2025** | **December 31,<br>2024** |
| Pension and other post-retirement benefit plans - unrecognized prior service costs and net actuarial loss | $(5776) | $(5890) |
| Interest rate swaps - net gain (loss) on fair value | (181) | 121 |
| &nbsp;&nbsp;Total accumulated other comprehensive income (loss) | $(5957) | $(5769) |

---

**11. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES**

We are exposed to market risks related to fluctuations in interest rates. To mitigate these risks, we may utilize derivative instruments in the form of interest rate swaps. We do not enter into derivative transactions for speculative purposes.

Under the Company's Credit Facility, the SOFR plus 2.00% to SOFR plus 3.00% will be applied to outstanding borrowings. See Note 7 - *Long-term Debt, net* for additional information. The Company has elected to apply the optional expedient for hedging relationships affected by reference rate reform. Accordingly, no outstanding balance on the Credit Facility with a SOFR rate will preclude cash flow hedging with existing London Inter-Bank Offer Rate ("LIBOR") hedging instruments.

In August 2014, we entered into a swap agreement, that expired on August 29, 2024, with a notional amount of $25.0 million ("2014 Variable-to-Fixed Swap"), and the LIBOR portion of the interest rate was fixed at 2.5%. In February 2020, we entered into a second swap agreement with a notional amount of $25.0 million ("2020 Variable-to-Fixed Swap"), and the LIBOR

[<u>Return to Index</u>](#index)

------

portion of the interest rate was fixed at 1.3% through February 28, 2025. These interest rate swap agreements were terminated, dedesignated and settled in March 2021. The hedging relationship was highly effective; therefore, gains and losses on these swaps were reclassified into interest expense in accordance with the forecasted transactions or the scheduled interest payments on the Credit Facility. The 2014 Variable-to-Fixed Swap was fully amortized during the year ended December 31, 2024, and the 2020 Variable-to-Fixed Swap was fully amortized as of February 28, 2025 through interest expense.

In March 2021, we entered into a new forward interest rate swap agreement and carried the fair value of the terminated 2014 and 2020 Variable-to-Fixed Swaps into the new agreement in a "blend and extend" structured transaction. The purpose of this forward interest rate swap agreement is to fix the underlying risk-free rate, that would be associated with the anticipated issuance of new long-term debt by the Company in future periods. The forward interest rate swap would hedge the risk-free rate on forecasted long-term debt through March 2033. Risk associated with future changes in the 10-year LIBOR interest rates have been fixed up to a notional amount of $60.0 million with this instrument. The interest rate swap qualifies as a cash flow hedging instrument. This forward interest rate swap agreement was terminated and settled in April 2022. The hedging relationship is highly effective, therefore, the gain on the termination of the forward interest rate swap was included in accumulated other comprehensive income (loss). On June 28, 2023, the Company issued the 2023 Senior Notes in the aggregate principal amount of $50.0 million at fixed interest rates of 7.25% and 7.50%. The Company has elected to apply the optional expedient for hedging relationships affected by reference rate reform. Accordingly, no outstanding balance on the 2023 Senior Notes will preclude cash flow hedging with the existing LIBOR hedging instrument. A net loss of $0.2 million is included in accumulated other comprehensive income (loss) at June 30, 2025. The unamortized balance on this swap will be amortized into interest expense in accordance with the forecasted transactions or the scheduled interest payments on the 2023 Senior Notes and any future debt through March 2033.

The effect of the interest rate swaps on the consolidated statements of operations is as follows (in thousands):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |  |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |  |
|  | **2025** | **2024** | **2025** | **2024** | **Income Statement <br>Classification** |
| **Derivatives designated as hedges:** | **Derivatives designated as hedges:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;5 year interest rate swap | $— | $22 | $(12) | $61 | Increase (decrease) to interest expense |
| &nbsp;&nbsp;&nbsp;&nbsp;10 year interest rate swap | (162) | (270) | (370) | (606) | Increase (decrease) to interest expense |
|  | $(162) | $(248) | $(382) | $(545) |  |

---

**12. FINANCIAL INSTRUMENTS** 

The Company's only financial assets and liabilities which are measured at fair value on a recurring basis relate to certain aspects of the Company's benefit plans. We use the market approach to determine the fair value of these assets and liabilities using significant other observable inputs (Level 2) with the assistance of third-party specialists. We do not have any assets or liabilities measured at fair value on a recurring basis using quoted prices in an active market (Level 1) or significant unobservable inputs (Level 3). Gains and losses related to the fair value changes in the financial assets and liabilities are recorded in general and administrative expense in the consolidated statements of operations.

[<u>Return to Index</u>](#index)

------

The following table summarizes the fair value balances (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |  | **Fair Value Measurement at** | **Fair Value Measurement at** | **Fair Value Measurement at** |
|  |  | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Company owned life insurance policies <sup>(1)</sup> | $25504 | $— | $25504 | $— |
|  | $25504 | $— | $25504 | $— |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred compensation liabilities | $19198 | $— | $19198 | $— |
|  | $19198 | $— | $19198 | $— |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |  | **Fair Value Measurement at** | **Fair Value Measurement at** | **Fair Value Measurement at** |
|  |  | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|  | **Total** | **Level 1** | **Level 2** | **Level 3** |
| Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Company owned life insurance policies <sup>(1)</sup> | $25435 | $— | $25435 | $— |
|  | $25435 | $— | $25435 | $— |
| Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred compensation liabilities | $19103 | $— | $19103 | $— |
|  | $19103 | $— | $19103 | $— |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(1) Company owned life insurance policies have cash surrender value and are intended to assist in funding deferred compensation liabilities and other benefit plans.*

**13. OTHER (INCOME) EXPENSE, NET**

The components of other (income) expense, net, are as follows (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| (Gain) loss on sale of assets | $(217) | $(217) | $(223) | $(754) |
| Results of non-consolidated subsidiaries | 244 | (68) | 207 | (99) |
| Foreign exchange (gain) loss, net | 7 | 388 | 487 | 674 |
| Rents and royalties | (9) | (795) | (16) | (801) |
| Return on pension assets and other pension costs | (301) | (287) | (581) | (577) |
| Assets write-down, loss on lease abandonment and other exit costs |  |  | 707 | 1809 |
| Insurance recovery - business interruption and costs | (979) | (1319) | (979) | (2330) |
| Insurance recovery - property, plant and equipment | (1577) |  | (1577) |  |
| Severance and other charges |  |  | 2256 | 824 |
| Other, net | (135) | (92) | (913) | (290) |
| &nbsp;&nbsp;Total other (income) expense, net | $(2967) | $(2390) | $(632) | $(1544) |

---

During the six months ended June 30, 2025 and 2024, as a result of consolidating and exiting certain facilities in the U.S. and other international locations, we recognized a write-down of the associated leasehold improvements, right of use assets and other assets and incurred lease abandonment and other exit costs of $0.7 million and $1.8 million, respectively.

In February 2024, we had a fire incident at our Aberdeen, U.K. facility and we have recorded insurance recovery associated with business interruptions, increase in cost of work, and loss on property and assets during the three and six months ended June 30, 2025 and 2024.

[<u>Return to Index</u>](#index)

------

Foreign exchange (gain) loss, net by currency is summarized in the following table (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| British Pound | $(54) | $39 | $(60) | $70 |
| Canadian Dollar | (100) | 34 | (54) | 73 |
| Colombian Peso | (62) | (23) | (60) | (30) |
| Euro | 517 | 47 | 802 | 65 |
| Indonesian Rupiah | (41) | 145 | 33 | 225 |
| Russian Ruble | (149) | 18 | (335) | 14 |
| Swedish Krona | 26 | (48) | 123 | 18 |
| Other currencies, net | (130) | 176 | 38 | 239 |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net | $7 | $388 | $487 | $674 |

---

**14. INCOME TAX EXPENSE (BENEFIT)**

The Company recorded an income tax expense of $1.9 million and $3.7 million for the three and six months ended June 30, 2025, respectively compared to income tax expense of $3.6 million and $5.3 million for the three and six months ended June 30, 2024, respectively. The effective tax rate for the three and six months ended June 30, 2025, was 15.2% and 25.4%, respectively. The effective tax rate for the three and six months ended June 30, 2024, was 28.2% and 29.3%, respectively. The effective tax rate for the three and six months ended June 30, 2025, was impacted by the earnings mix of jurisdictions, changes in uncertain tax position in certain jurisdictions and the finalization of certain tax jurisdictions' return to provision assessments due to changes in estimates. These items are discrete to these periods. The tax rate for the three and six months ended June 30, 2024 was impacted by the earnings mix of jurisdictions subject to tax for the period and items discrete to the quarter.

On July 4, 2025, the "One Big Beautiful Bill Act" (the "Act") was enacted into law. The Act includes significant provisions, including tax cut extensions and modifications to the U.S. and international tax frameworks. We are evaluating the impact of these legislative changes as additional guidance becomes available, and uncertainty remains regarding the timing and interpretation by tax authorities in affected jurisdictions.

**15. EARNINGS PER SHARE**

We compute basic earnings per share by dividing net income attributable to Core Laboratories Inc. by the number of weighted average common shares outstanding during the period. Diluted earnings per share includes the incremental effect of contingently issuable shares from performance and restricted stock awards, as determined using the treasury stock method.

The following table summarizes the calculation of weighted average common shares outstanding used in the computation of basic and diluted earnings per share (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Weighted average common shares outstanding - basic | 46632 | 46908 | 46702 | 46884 |
| Effect of dilutive securities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Restricted shares | 16 | 66 | 27 | 48 |
| &nbsp;&nbsp;&nbsp;&nbsp;Performance shares | 716 | 769 | 780 | 730 |
| Weighted average common shares outstanding - diluted | 47364 | 47743 | 47509 | 47662 |

---

[<u>Return to Index</u>](#index)

------

**16. SEGMENT REPORTING**

We operate our business in two segments. These complementary operating segments provide different services and products and utilize different technologies for evaluating and improving reservoir performance and increasing oil and gas recovery from new and existing fields.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Reservoir Description:* Encompasses the characterization of petroleum reservoir rock and reservoir fluids samples to increase production and improve recovery of crude oil and natural gas from our clients' reservoirs. We provide laboratory-based analytical and field services to characterize properties of crude oil and crude oil-derived products to the oil and gas industry. Services associated with these fluids include determining the quality and measuring the quantity of the reservoir fluids and their derived products, such as gasoline, diesel and biofuels. We also provide proprietary and joint industry studies based on these types of analyses and manufacture associated laboratory equipment. In addition, we provide reservoir description capabilities that support various activities associated with energy transition projects, including services that support carbon capture, utilization and storage, geothermal projects, and the evaluation and appraisal of mining activities around lithium and other elements necessary for energy storage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Production Enhancement:* Includes services and manufactured products associated with reservoir well completions, perforations, stimulation, production and well abandonment. We provide integrated diagnostic services to evaluate and monitor the effectiveness of well completions and to develop solutions aimed at increasing the effectiveness of enhanced oil recovery projects.

We use the same accounting policies to prepare our operating segment results as are used to prepare our consolidated financial statements. All interest and other non-operating income (expense) is attributable to Corporate & Other and is not allocated to specific operating segments.

Our chief operating decision maker ("CODM") is our Chief Executive Officer, who also serves as Chairman of the Board of Directors. The CODM uses revenue from unaffiliated clients and segment operating income to allocate resources, primarily for working capital, staffing and capital expenditures, during the annual budgeting process and monthly when comparing actual results to budgeted and forecasted results.

Summarized financial information of our operating segments is shown in the following table (in thousands):

[<u>Return to Index</u>](#index)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Reservoir<br>Description** | **Production<br>Enhancement** | **Corporate &<br>Other** <sup>(1)</sup> | **Consolidated** |
| **Three months ended June 30, 2025** |  |  |  |  |
| CODM Measure - Revenue from unaffiliated clients | $86280 | $43879 | $— | $130159 |
| Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: |
| &nbsp;&nbsp;&nbsp;&nbsp;Inter-segment revenue | 41 | 46 | (87) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services and product sales | 66940 | 36376 | 385 | 103701 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense <sup>(2)</sup> | 6816 | 3648 |  | 10464 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 2645 | 1025 |  | 3670 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other operating (income) expense, net <sup>(3)</sup> | (2472) | (90) | (412) | (2974) |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net <sup>(3)</sup> | 189 | (182) |  | 7 |
| &nbsp;&nbsp;&nbsp;&nbsp;CODM Measure - Segment operating income | 12203 | 3148 | (60) | 15291 |
| Supplemental Disclosures: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | 322158 | 146907 | 133046 | 602111 |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures | 3753 | 575 |  | 4328 |
| **Three months ended June 30, 2024** |  |  |  |  |
| CODM Measure - Revenue from unaffiliated clients | $86277 | $44300 | $— | $130577 |
| Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: |
| &nbsp;&nbsp;&nbsp;&nbsp;Inter-segment revenue | 23 | 15 | (38) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services and product sales | 67335 | 35392 | 203 | 102930 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense <sup>(2)</sup> | 6741 | 3518 |  | 10259 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 2707 | 1063 |  | 3770 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other operating (income) expense, net <sup>(3)</sup> | (2272) | (174) | (332) | (2778) |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net <sup>(3)</sup> | 346 | 115 | (73) | 388 |
| &nbsp;&nbsp;&nbsp;&nbsp;CODM Measure - Segment operating income | 11443 | 4401 | 164 | 16008 |
| Supplemental Disclosures: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | 313128 | 161396 | 123275 | 597799 |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures | 2377 | 267 | 223 | 2867 |
| **Six months ended June 30, 2025** |  |  |  |  |
| CODM Measure - Revenue from unaffiliated clients | $167177 | $86567 | $— | $253744 |
| Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: |
| &nbsp;&nbsp;&nbsp;&nbsp;Inter-segment revenue | 57 | 114 | (171) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services and product sales | 131545 | 71137 | 488 | 203170 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense <sup>(2)</sup> | 15854 | 8257 |  | 24111 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 5260 | 2127 |  | 7387 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other operating (income) expense, net <sup>(3)</sup> | (344) | 448 | (1223) | (1119) |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net <sup>(3)</sup> | 377 | 61 | 49 | 487 |
| &nbsp;&nbsp;&nbsp;&nbsp;CODM Measure - Segment operating income | 14542 | 4651 | 515 | 19708 |
| Supplemental Disclosures: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | 322158 | 146907 | 133046 | 602111 |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures | 6175 | 1704 | 28 | 7907 |
| **Six months ended June 30, 2024** |  |  |  |  |
| CODM Measure - Revenue from unaffiliated clients | $170513 | $89701 | $— | $260214 |
| Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: | Reconciliation of CODM measure - revenue from unaffiliated clients to segment operating income: |
| &nbsp;&nbsp;&nbsp;&nbsp;Inter-segment revenue | 37 | 62 | (99) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services and product sales | 133445 | 73717 | 356 | 207518 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense <sup>(2)</sup> | 14300 | 7748 |  | 22048 |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 5471 | 2142 |  | 7613 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other operating (income) expense, net <sup>(3)</sup> | (1593) | 26 | (651) | (2218) |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net <sup>(3)</sup> | 591 | 153 | (70) | 674 |
| &nbsp;&nbsp;&nbsp;&nbsp;CODM Measure - Segment operating income | 18336 | 5977 | 266 | 24579 |
| Supplemental Disclosures: |  |  |  |  |

---

[<u>Return to Index</u>](#index)

------

---

| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets | 313128 | 161396 | 123275 | 597799 |
| &nbsp;&nbsp;&nbsp;&nbsp;Capital expenditures | 5208 | 487 | 223 | 5918 |

---

(1) "Corporate & Other" represents those items that are not directly related to a particular operating segment and eliminations.

*(2) General and administrative expense is presented as a total amount to the CODM and consists primarily of employee compensation costs, professional fees and information technology costs.*

*(3) Other remaining balance is included in other (income) expense, net. See Note 13 - Other (income) expense, net for further details.* 

[<u>Return to Index</u>](#index)

------

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations**

The following discussion highlights the current operating environment and summarizes the financial position of Core Laboratories Inc. and its subsidiaries as of June 30, 2025, and should be read in conjunction with (i) the unaudited interim consolidated financial statements and notes thereto included elsewhere in this Quarterly Report and (ii) the audited consolidated financial statements and accompanying notes thereto included in our 2024 Annual Report on Form 10-K for the year ended December 31, 2024.

**General**

Core Laboratories Inc. is a Delaware corporation. It was established in 1936 and is one of the world's leading providers of proprietary and patented reservoir description and production enhancement services and products to the oil and gas industry. These services and products can enable our clients to evaluate and improve reservoir performance and increase oil and gas recovery from new and existing fields. We make measurements on reservoir rocks, reservoir fluids (crude oil, natural gas and water) and their derived products. In addition, we assist clients in evaluating subsurface targets associated with carbon capture and sequestration projects or initiatives. Core Laboratories Inc. has over 70 offices in more than 50 countries and employs approximately 3,300 people worldwide.

References to "Core Lab", "Core Laboratories", the "Company", "we", "our" and similar phrases are used throughout this Quarterly Report and relate collectively to Core Laboratories Inc. and its consolidated affiliates.

We operate our business in two segments. These complementary operating segments provide different services and products and utilize different technologies for evaluating and improving reservoir performance and increasing oil and gas recovery from new and existing fields.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Reservoir Description:* Encompasses the characterization of petroleum reservoir rock and reservoir fluids samples to increase production and improve recovery of crude oil and natural gas from our clients' reservoirs. We provide laboratory-based analytical and field services to characterize properties of crude oil and crude oil-derived products to the oil and gas industry. Services associated with these fluids include determining the quality and measuring the quantity of the reservoir fluids and their derived products, such as gasoline, diesel and biofuels. We also provide proprietary and joint industry studies based on these types of analyses and manufacture associated laboratory equipment. In addition, we provide reservoir description capabilities that support various activities associated with energy transition projects, including services that support carbon capture, utilization and storage, geothermal projects, and the evaluation and appraisal of mining activities around lithium and other elements necessary for energy storage.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *Production Enhancement:* Includes services and manufactured products associated with reservoir well completions, perforations, stimulation, production and well abandonment. We provide integrated diagnostic services to evaluate and monitor the effectiveness of well completions and to develop solutions aimed at increasing the effectiveness of enhanced oil recovery projects.

**Cautionary Statement Regarding Forward-Looking Statements**

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 ("Exchange Act"). Certain statements contained in this Management's Discussion and Analysis of Financial Condition and Results of Operations section, including those under the headings "Outlook" and "Liquidity and Capital Resources", and in other parts of this Quarterly Report, are forward-looking. In addition, from time to time, we may publish forward-looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new products, research and development activities and similar matters. Forward-looking statements can be identified by the use of forward-looking terminology such as "may", "will", "believe", "expect", "anticipate", "estimate", "continue", or other similar words, including statements as to the intent, belief, or current expectations of our directors, officers, and management with respect to our future operations, performance, or positions or

[<u>Return to Index</u>](#index)

------

which contain other forward-looking information. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, no assurances can be given that the future results indicated, whether expressed or implied, will be achieved. While we believe that these statements are and will be accurate, our actual results and experience may differ materially from the anticipated results or other expectations expressed in our statements due to a variety of risks and uncertainties.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see Part II, "Item 1A - Risk Factors" of this Quarterly Report and "Item 1A - Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2024, filed by us with the Securities and Exchange Commission ("SEC").

**Outlook**

According to the latest reports from the U.S. Energy Information Administration, the International Energy Agency and the Organization of the Petroleum Exporting Countries and other oil producing nations ("OPEC+"), global demand for crude oil and natural gas is expected to continue increasing in 2025 and beyond. Beginning in April 2025, the announcement of new tariffs by the U.S. has triggered global trade negotiations and has raised the level of uncertainty for global economies. Additionally, OPEC+ affirmed their decision to proceed with a gradual return of 2.2 million barrels of daily production by removing the voluntary production restrictions established in 2023. The gradual increase in production from OPEC+ began in May 2025 with incremental increases in production expected through September 2026. OPEC also published an updated "compensation plan" which shows committed reductions in production for countries that produced volumes over their committed quotas since January 2024, which if complied with, should partially offset the scheduled increases to production quotas. In each announcement from OPEC+ regarding the production increases, they have also stated they will continue to hold monthly meetings to review market conditions, conformity, and compensation.

The uncertainty around the impact global trade negotiations may have on global economies combined with OPEC+'s announcement of increased production quotas has also increased the likelihood that global inventory levels of crude oil will rise, thereby contributing to weaker crude oil prices. The Company believes that activity levels associated with smaller-scale, short-cycle crude oil development projects will be more sensitive to a decrease and/or continued volatility of crude-oil prices. As such, we expect changes in crude oil prices will have a greater impact on drilling and completion activity levels in the U.S. onshore market. Outside the U.S., large-scale international oil and gas projects are expected to be more resilient to the near-term volatility of crude-oil prices, and the Company anticipates current client projects to continue as planned and additional projects scheduled this year to also be executed as planned.

The ongoing geopolitical conflicts between Russia and Ukraine and in the Middle East, along with associated and expanded sanctions in the United States, the European Union, the United Kingdom and other countries continue to cause disruptions to traditional maritime supply chains and the trading of crude oil and derived products, such as diesel fuel. These disruptions to the trading and maritime transportation of crude oil, also impact the demand for the Company's associated laboratory assay services. Although demand for the Company's laboratory assay analysis services increased in the second quarter compared to the first quarter of 2025, these geopolitical conflicts and associated sanctions continue to create a higher level of uncertainty. We have no way to predict the progress or outcome of these events, and any resulting government responses are fluid and beyond our control.

We continue to focus on large-scale core analyses and reservoir fluids characterization studies in most oil-producing regions across the globe, which include both newly developed fields and brownfield extensions in many offshore developments in both the U.S. and internationally. In the U.S., we are involved in projects with many of the onshore unconventional basins and offshore projects in the Gulf of Mexico. Outside the U.S., we continue to work on many small and large-scale projects analyzing reservoir rock and fluid samples in every major producing region of the world. Notable larger projects are in locations such as offshore South America, Australia, West Africa and the Middle East. Analysis and measurement services also

[<u>Return to Index</u>](#index)

------

occur in every major producing region of the world. Additionally, some of our major clients have increased their investment in projects to capture and sequester carbon dioxide in recent years that has expanded the Company's activities on these projects beginning in 2024 and into 2025.

Our major clients continue to focus on capital management, return on invested capital, free cash flow and returning capital to their shareholders, as opposed to a focus on production growth. The companies adopting value versus volume metrics tend to be the more technologically sophisticated operators and form the foundation of Core Lab's worldwide client base. As oil and gas commodity prices stabilize in the mid-to-long-term, the Company expects our clients' activities associated with increasing oil and gas reserves and production levels will continue to increase in the coming years.

[<u>Return to Index</u>](#index)

------

**Results of Operations**

Our results of operations as a percentage of applicable revenue are as follows (in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Three Months Ended June 30,** |  |  |
|  | **2025** | **2025** | **2024** | **2024** | **$ Change** | **% Change** |
| REVENUE: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services | $96219 | 74% | $96337 | 74% | $(118) | (0)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | 33940 | 26% | 34240 | 26% | (300) | (1)% |
| Total revenue | 130159 | 100% | 130577 | 100% | (418) | (0)% |
| OPERATING EXPENSES: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services, exclusive of depreciation expense shown below\* | 74053 | 77% | 74823 | 78% | (770) | (1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of product sales, exclusive of depreciation expense shown below\* | 29648 | 87% | 28107 | 82% | 1541 | 5% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total cost of services and product sales | 103701 | 80% | 102930 | 79% | 771 | 1% |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense, exclusive of depreciation expense shown below | 10464 | 8% | 10259 | 8% | 205 | 2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 3670 | 3% | 3770 | 3% | (100) | (3)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (income) expense, net | (2967) | (2)% | (2390) | (2)% | (577) | 24% |
| OPERATING INCOME | 15291 | 12% | 16008 | 12% | (717) | (4)% |
| Interest expense | 2711 | 2% | 3209 | 2% | (498) | (16)% |
| Income before income taxes | 12580 | 10% | 12799 | 10% | (219) | (2)% |
| Income tax expense | 1911 | 1% | 3609 | 3% | (1698) | (47)% |
| Net income | 10669 | 8% | 9190 | 7% | 1479 | 16% |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 33 | —% | 158 | —% | (125) | NM |
| Net income attributable to Core Laboratories Inc. | $10636 | 8% | $9032 | 7% | $1604 | 18% |
| **Other Data:** |  |  |  |  |  |  |
| Current ratio <sup>(1)</sup> | 2.27:1 |  | 2.39:1 |  |  |  |
| Debt to EBITDA ratio <sup>(2)</sup> | 1.33:1 |  | 1.86:1 |  |  |  |
| Debt to Adjusted EBITDA ratio <sup>(3)</sup> | 1.27:1 |  | 1.66:1 |  |  |  |

---

"NM" means not meaningful

\*Percentage based on applicable revenue rather than total revenue

*(1) Current ratio is calculated as follows: current assets divided by current liabilities.*

*(2) Debt to EBITDA ratio is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation, amortization and certain non-cash adjustments.*

*(3) Debt to Adjusted EBITDA ratio (as defined in our Credit Facility) is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation, amortization, impairments, severance and certain non-cash adjustments.*

[<u>Return to Index</u>](#index)

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** |  |  |
|  | **June 30, 2025** | **June 30, 2025** | **March 31, 2025** | **March 31, 2025** | **$ Change** | **% Change** |
| REVENUE: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services | $96219 | 74% | $95091 | 77% | $1128 | 1% |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | 33940 | 26% | 28494 | 23% | 5446 | 19% |
| Total revenue | 130159 | 100% | 123585 | 100% | 6574 | 5% |
| OPERATING EXPENSES: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services, exclusive of depreciation expense shown below\* | 74053 | 77% | 72980 | 77% | 1073 | 1% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of product sales, exclusive of depreciation expense shown below\* | 29648 | 87% | 26489 | 93% | 3159 | 12% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total cost of services and product sales | 103701 | 80% | 99469 | 80% | 4232 | 4% |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense, exclusive of depreciation expense shown below | 10464 | 8% | 13647 | 11% | (3183) | (23)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 3670 | 3% | 3717 | 3% | (47) | (1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (income) expense, net | (2967) | (2)% | 2335 | 2% | (5302) | NM |
| OPERATING INCOME | 15291 | 12% | 4417 | 4% | 10874 | 246% |
| Interest expense | 2711 | 2% | 2602 | 2% | 109 | 4% |
| Income before income taxes | 12580 | 10% | 1815 | 1% | 10765 | 593% |
| Income tax expense | 1911 | 1% | 1746 | 1% | 165 | 9% |
| Net income | 10669 | 8% | 69 | —% | 10600 | 15362% |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 33 | —% | 223 | —% | (190) | NM |
| Net income (loss) attributable to Core Laboratories Inc. | $10636 | 8% | $(154) | —% | $10790 | NM |
| **Other Data:** |  |  |  |  |  |  |
| Current ratio <sup>(1)</sup> | 2.27:1 |  | 2.21:1 |  |  |  |
| Debt to EBITDA ratio <sup>(2)</sup> | 1.33:1 |  | 1.37:1 |  |  |  |
| Debt to Adjusted EBITDA ratio <sup>(3)</sup> | 1.27:1 |  | 1.31:1 |  |  |  |

---

"NM" means not meaningful

\*Percentage based on applicable revenue rather than total revenue

*(1) Current ratio is calculated as follows: current assets divided by current liabilities.*

*(2) Debt to EBITDA ratio is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation and amortization and certain non-cash adjustments.*

*(3) Debt to Adjusted EBITDA ratio (as defined in our Credit Facility) is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation, amortization, impairments, severance and certain non-cash adjustments.*

[<u>Return to Index</u>](#index)

------

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** |  |  |
|  | **2025** | **2025** | **2024** | **2024** | **$ Change** | **% Change** |
| REVENUE: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Services | $191310 | 75% | $192832 | 74% | $(1522) | (1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | 62434 | 25% | 67382 | 26% | (4948) | (7)% |
| Total revenue | 253744 | 100% | 260214 | 100% | (6470) | (2)% |
| OPERATING EXPENSES: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of services, exclusive of depreciation expense shown below\* | 147033 | 77% | 148688 | 77% | (1655) | (1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of product sales, exclusive of depreciation expense shown below\* | 56137 | 90% | 58830 | 87% | (2693) | (5)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total cost of services and product sales | 203170 | 80% | 207518 | 80% | (4348) | (2)% |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative expense, exclusive of depreciation expense shown below | 24111 | 10% | 22048 | 8% | 2063 | 9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 7387 | 3% | 7613 | 3% | (226) | (3)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Other (income) expense, net | (632) | —% | (1544) | (1)% | 912 | (59)% |
| OPERATING INCOME | 19708 | 8% | 24579 | 9% | (4871) | (20)% |
| Interest expense | 5313 | 2% | 6632 | 3% | (1319) | (20)% |
| Income before income taxes | 14395 | 6% | 17947 | 7% | (3552) | (20)% |
| Income tax expense | 3657 | 1% | 5267 | 2% | (1610) | (31)% |
| Net income | 10738 | 4% | 12680 | 5% | (1942) | (15)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income attributable to non-controlling interest | 256 | —% | 428 | —% | (172) | NM |
| Net income attributable to Core Laboratories Inc. | $10482 | 4% | $12252 | 5% | $(1770) | (14)% |
| **Other Data:** |  |  |  |  |  |  |
| Current ratio <sup>(1)</sup> | 2.27:1 |  | 2.39:1 |  |  |  |
| Debt to EBITDA ratio <sup>(2)</sup> | 1.33:1 |  | 1.86:1 |  |  |  |
| Debt to Adjusted EBITDA ratio <sup>(3)</sup> | 1.27:1 |  | 1.66:1 |  |  |  |

---

"NM" means not meaningful

\*Percentage based on applicable revenue rather than total revenue

*(1) Current ratio is calculated as follows: current assets divided by current liabilities.*

*(2) Debt to EBITDA ratio is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation and amortization and certain non-cash adjustments.*

*(3) Debt to Adjusted EBITDA ratio (as defined in our Credit Facility) is calculated as follows: debt less cash divided by the sum of consolidated net income plus interest, taxes, depreciation, amortization, impairments, severance and certain non-cash adjustments.*

***Operating Results for the Three Months Ended June 30, 2025 compared to the Three Months Ended June 30, 2024 and March 31, 2025 and for the Six Months Ended June 30, 2025 compared to the Six Months Ended June 30, 2024*** 

**Service Revenue**

Service revenue is primarily tied to activities associated with the exploration, appraisal, development and production of oil, gas and derived products outside the U.S. For the three months ended June 30, 2025, service revenue was $96.2 million, flat year-over-year and an increase of 1% sequentially. Year-over-year, revenues remained relatively flat due to an increase in international markets offset by a reduction in the U.S. market. Despite disruptions from the ongoing geopolitical conflicts and expanded sanctions in January 2025, we had some recovery in demand for our laboratory assay services during the second quarter of 2025 and continued growth in well completion diagnostic services in certain international markets when compared to the same period in 2024. Service revenue in 2025 has been negatively impacted by certain projects that were planned and scheduled but were canceled, as the wells drilled by our clients were determined to be uneconomical or unsuccessful.

[<u>Return to Index</u>](#index)

------

Sequentially, the increase in service revenue was primarily due to a recovery in demand for laboratory assay services in international markets partially offset by a decrease in the U.S. market. As discussed above, the expanded sanctions announced in January 2025 had caused a temporary disruption in the trading and maritime transportation of crude oil and derived products, and demand for the associated laboratory assay services declined during the first quarter of 2025. These activities re-stabilized in the second quarter of 2025 and demand for our associated crude assay services also increased during the three months ended June 30, 2025.

For the six months ended June 30, 2025, service revenue was $191.3 million, a decrease of 1% compared to the same period in the prior year, primarily driven by the disruptions to the maritime movement and trading of crude oil during the first quarter of 2025, as discussed above.

**Product Sales Revenue**

Product sales are primarily tied to supporting the U.S. onshore drilling and completion activities and bulk product sales to international markets. Product sales to international markets are typically sold and shipped in bulk, and revenue can vary from one quarter to another. For the three months ended June 30, 2025, product sales revenue of $33.9 million decreased 1% year-over-year and increased 19% sequentially. The decrease was driven by lower drilling and completion activity onshore in the U.S. for the three months ended June 30, 2025 when compared to the same period in 2024, resulting in a lower level of product sales in the U.S. onshore market.

Sequentially, the increase was due to a higher levels of bulk shipments to international markets, as well as higher level of laboratory instrumentation sales.

For the six months ended June 30, 2025, product sales revenue was $62.4 million and decreased 7% compared to the same period in the prior year, primarily due to decreased sales in the U.S. onshore markets as a result of lower average drilling and completion activity in 2025 compared to 2024, which was partially offset by increased international bulk product sales.

**Cost of Services, excluding depreciation**

Cost of services was $74.1 million for the three months ended June 30, 2025, a decrease of 1% year-over-year and an increase of 1% sequentially. The year-over-year and sequential changes in cost of services was in line with changes in service revenue. Cost of services expressed as a percentage of service revenue was 77% for the three months ended June 30, 2025, compared to 78% for the same period in the prior year. Cost of services as a percentage of service revenue remained relatively flat sequentially.

For the six months ended June 30, 2025, cost of services was $147.0 million, a decrease of 1% compared to the same period in the prior year. The year-over-year changes in cost of services was in line with changes in service revenue. Cost of services expressed as a percentage of service revenue remained relatively flat compared to the same period in the prior year.

**Cost of Product Sales, excluding depreciation**

Cost of product sales was $29.6 million for the three months ended June 30, 2025, an increase of 5% year-over-year and 12% sequentially. Cost of product sales expressed as a percentage of product sales revenue was 87% for the three months ended June 30, 2025, compared to 82% for the same period in the prior year and compared to 93% in the prior quarter. The year-over-year changes in cost of product sales as a percentage of product sales increased primarily due to higher absorption of fixed costs on a lower revenue base, along with a write-down of certain inventory of approximately $0.8 million in the three months ended June 30, 2025.

Sequentially, cost of product sales as a percentage of product sales improved due to improved absorption of fixed costs on a higher revenue base, partially offset by the write-down of certain inventory as previously discussed.

[<u>Return to Index</u>](#index)

------

For the six months ended June 30, 2025, cost of product sales was $56.1 million, a decrease of 5% compared to the same period in the prior year. Cost of product sales expressed as a percentage of product sales revenue was 90% for the six months ended June 30, 2025, compared to 87% from the same period in the prior year. The increase in cost of product sales as a percentage of product sales revenue was due to higher absorption of fixed costs on a lower revenue base and the write-down of certain inventory as discussed above.

**General and Administrative Expense, excluding depreciation**

General and administrative ("G&A") expense includes corporate management and centralized administrative services that benefit our operations.

G&A expense for the three months ended June 30, 2025, was $10.5 million, which increased 2% or $0.2 million, compared to the same period in 2024. The slight year-over-year increase was primarily due to increased consulting and license fees associated with implementation costs of a global human capital management system partially offset by gains on our company owned life insurance policies in 2025 compared to 2024.

G&A expense for the three months ended June 30, 2025, decreased $3.2 million compared to the prior quarter primarily due to the acceleration of stock compensation expense for retirement eligible executives of $3.5 million in the first quarter of 2025, partially offset by changes in employee compensations costs in these periods.

For the six months ended June 30, 2025, G&A expense was $24.1 million compared to $22.0 million for the six months ended June 30, 2024. The year-over-year increase was due to increased license fees and implementation costs associated with a new global human capital management system and outside consulting fees as discussed previously, and changes in employee compensation costs.

**Depreciation and Amortization Expense**

Depreciation and amortization expense for the three months ended June 30, 2025, was $3.7 million, a decrease of 3% year-over-year and 1% sequentially. Depreciation and amortization expense for the six months ended June 30, 2025, was $7.4 million, a decrease of 3% year-over-year. The decrease in depreciation and amortization expense compared to the prior year periods and sequentially is primarily due to assets which became fully depreciated.

**Other (Income) Expense, Net**

The components of other (income) expense, net, are as follows (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| (Gain) loss on sale of assets | $(217) | $(217) | $(223) | $(754) |
| Results of non-consolidated subsidiaries | 244 | (68) | 207 | (99) |
| Foreign exchange (gain) loss, net | 7 | 388 | 487 | 674 |
| Rents and royalties | (9) | (795) | (16) | (801) |
| Return on pension assets and other pension costs | (301) | (287) | (581) | (577) |
| Assets write-down, loss on lease abandonment and other exit costs |  |  | 707 | 1809 |
| Insurance recovery - business interruption and costs | (979) | (1319) | (979) | (2330) |
| Insurance recovery - property, plant and equipment | (1577) |  | (1577) |  |
| Severance and other charges |  |  | 2256 | 824 |
| Other, net | (135) | (92) | (913) | (290) |
| &nbsp;&nbsp;Total other (income) expense, net | $(2967) | $(2390) | $(632) | $(1544) |

---

[<u>Return to Index</u>](#index)

------

During the six months ended June 30, 2025 and 2024, as a result of consolidating and exiting certain facilities in the U.S. and other international locations, we recognized a write-down of the associated leasehold improvements, right of use assets and other assets and incurred lease abandonment and other exit costs of $0.7 million and $1.8 million, respectively.

In February 2024, we had a fire incident at our Aberdeen, U.K. facility and we have recorded insurance recovery associated with business interruptions, increase in cost of work, and loss on property and assets during the three and six months ended June 30, 2025 and 2024.

Foreign exchange (gain) loss, net by currency is summarized in the following table (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30,** | **June 30,** | **June 30,** | **June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| British Pound | $(54) | $39 | $(60) | $70 |
| Canadian Dollar | (100) | 34 | (54) | 73 |
| Colombian Peso | (62) | (23) | (60) | (30) |
| Euro | 517 | 47 | 802 | 65 |
| Indonesian Rupiah | (41) | 145 | 33 | 225 |
| Russian Ruble | (149) | 18 | (335) | 14 |
| Swedish Krona | 26 | (48) | 123 | 18 |
| Other currencies, net | (130) | 176 | 38 | 239 |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange (gain) loss, net | $7 | $388 | $487 | $674 |

---

**Interest Expense**

Interest expense for the three months ended June 30, 2025, was $2.7 million and decreased $0.5 million or 16% year-over-year and slightly increased compared to the prior quarter. For the six months ended June 30, 2025, interest expense decreased $1.3 million or 20%.

The year-over-year decreases are primarily due to lower average borrowings on our bank revolving credit facility during the three and six months ended June 30, 2025. Slight increase sequentially is primarily due to changes in blended variable interest rates on our bank revolving credit facility during these periods.

**Income Tax Expense (Benefit)**

The Company recorded an income tax expense of $1.9 million and $3.7 million for the three and six months ended June 30, 2025, respectively compared to income tax expense of $3.6 million and $5.3 million for the three and six months ended June 30, 2024, respectively. The effective tax rate for the three and six months ended June 30, 2025, was 15.2% and 25.4%, respectively. The effective tax rate for the three and six months ended June 30, 2024, was 28.2% and 29.3%, respectively. The effective tax rate for the three and six months ended June 30, 2025, was impacted by the earnings mix of jurisdictions, changes in uncertain tax position in certain jurisdictions and the finalization of certain tax jurisdictions' return to provision assessments due to changes in estimates. These items are discrete to these periods. The tax rate for the three and six months ended June 30, 2024 was impacted by the earnings mix of jurisdictions subject to tax for the period and items discrete to the quarter.

On July 4, 2025, the "One Big Beautiful Bill Act" (the "Act") was enacted into law. The Act includes significant provisions, including tax cut extensions and modifications to the U.S. and international tax frameworks. We are evaluating the impact of these legislative changes as additional guidance becomes available, and uncertainty remains regarding the timing and interpretation by tax authorities in affected jurisdictions. These legislative changes could have an adverse impact on our future effective tax rate, tax assets and liabilities, including our deferred tax assets and liabilities, and cash payments for tax.

[<u>Return to Index</u>](#index)

------

**Segment Analysis**

We operate our business in two segments. These complementary operating segments provide different services and products and utilize different technologies for evaluating and improving reservoir performance and increasing oil and gas recovery from new and existing fields. The following tables summarize our results by operating segment (in thousands):

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Year-over-year** | **Sequential** |
|  | **June 30, 2025** | **June 30, 2025** | **June 30, 2024** | **June 30, 2024** | **March 31, 2025** | **March 31, 2025** | **% Change** | **%Change** |
| **REVENUE:** |  |  |  |  |  |  |  |  |
| Reservoir Description | $86280 | 66% | $86277 | 66% | $80897 | 65% | 0% | 7% |
| Production Enhancement | 43879 | 34% | 44300 | 34% | 42688 | 35% | (1)% | 3% |
| &nbsp;&nbsp;Consolidated | $130159 | 100% | $130577 | 100% | $123585 | 100% | (0)% | 5% |
| **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** | **OPERATING INCOME:** |
| Reservoir Description \* | $12203 | 14% | $11443 | 13% | $2339 | 3% | 7% | 422% |
| Production Enhancement \* | 3148 | 7% | 4401 | 10% | 1503 | 4% | (28)% | 109% |
| Corporate and Other <sup>(1)</sup> | (60) | 0% | 164 | 0% | 575 | 0% | NM | NM |
| &nbsp;&nbsp;Consolidated | $15291 | 12% | $16008 | 12% | $4417 | 4% | (4)% | 246% |
| *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margins, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Year-over-year** |
|  | **2025** | **2025** | **2024** | **2024** | **% Change** |
| **REVENUE:** |  |  |  |  |  |
| Reservoir Description | $167177 | 66% | $170513 | 66% | (2)% |
| Production Enhancement | 86567 | 34% | 89701 | 34% | (3)% |
| &nbsp;&nbsp;Consolidated | $253744 | 100% | $260214 | 100% | (2)% |
| **OPERATING INCOME (LOSS):** |  |  |  |  |  |
| Reservoir Description \* | $14542 | 9% | $18336 | 11% | (21)% |
| Production Enhancement \* | 4651 | 5% | 5977 | 7% | (22)% |
| Corporate and Other <sup>(1)</sup> | 515 | 0% | 266 | 0% | NM |
| &nbsp;&nbsp;Consolidated | $19708 | 8% | $24579 | 9% | (20)% |
| *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* | *\* Percentage, which represents operating margin, is based on operating income divided by applicable revenue rather than total revenue.<br>"NM" means not meaningful<br>(1) "Corporate and Other" represents those items that are not directly related to a particular operating segment.* |

---

**Reservoir Description**

Reservoir Description operations are closely correlated with trends in international and offshore activity levels, with approximately 80% of its revenue sourced from existing producing fields, development projects and movement of crude oil products outside the U.S.

Revenue from the Reservoir Description operating segment of $86.3 million for the three months ended June 30, 2025 relatively flat year-over-year and increased 7% sequentially. The year-over-year revenue growth in the Company's international projects and crude-assay services was substantially offset by lower revenue in the U.S. market. Sequentially, the increase in revenue was primarily due to higher revenue in laboratory crude-assay services, as the trading and maritime transportation of crude oil and derived products re-stabilized in the second quarter of 2025, after the expanded sanctions were announced in January of 2025. Additionally, revenue associated with manufactured laboratory instrumentation sales increased sequentially. Revenue in 2025 has been negatively impacted by the decrease in the success rate for international offshore exploration and appraisal wells, which reached a 20-year low for the six-month period ending March 31, 2025. The decrease in international offshore commercial success rates has resulted in the cancellation of several reservoir rock and fluid analysis projects that were originally planned for late 2024 and 2025.

[<u>Return to Index</u>](#index)

------

Revenue from the Reservoir Description operating segment of $167.2 million for the six months ended June 30, 2025 decreased 2% from the same period in the prior year. The decreased revenue in 2025 primarily due to the temporary disruption of the maritime movement and trading of crude oil and derived products which occurred in the first quarter of 2025. The decline in international offshore commercial success rate for exploration and appraisal wells projects, discussed above, has also negatively impacted the level of activity on international projects planned for 2025.

Operating income of $12.2 million for the three months ended June 30, 2025, increased $0.8 million, year-over-year and $9.9 million sequentially. Operating margins were 14% for the three months ended June 30, 2025, compared to 13% year-over-year, and 3% sequentially. Year-over-year, the increase in operating income and operating margins was primarily attributable to insurance recovery associated with the fire at the Aberdeen, U.K. facility of $2.6 million recorded in the three months ended June 30, 2025, compared to a $1.3 million gain in the same period in prior year.

Sequentially, the increase in operating income and operating margins was primarily due to 1) incremental revenue of $5.4 million in the three months ended June 30, 2025; 2) insurance recovery associated with the fire at the Aberdeen, U.K. facility of $2.6 million recorded in the three months ended June 30, 2025, and no such gain in the prior quarter; 3) a $2.4 million increase in the first quarter of 2025, associated with to the acceleration of stock compensation expense for retirement eligible executives; and 4) a total charge of $2.9 million associated with employee severance, facility consolidation and asset write-down recorded in the three months ended March 31, 2025, and no such transactions in the current quarter.

Operating income of $14.5 million for the six months ended June 30, 2025, decreased $3.8 million from the same period in the prior year. Operating margins were 9% for the six months ended June 30, 2025, compared to 11% for the same period in the prior year. The decrease in operating income and operating margins was primarily attributable to 1) decremental revenue of $3.3 million in 2025; 2) a different mix of revenue with a higher level of manufactured equipment sales that yield lower margin compared to service revenue; and 3) a total charge of $2.9 million associated with employee severance, facility consolidation and asset write-down recorded in 2025 compared to $1.5 million recorded in the same period in prior year.

**Production Enhancement**

Production Enhancement operations are largely focused on complex completions in unconventional oil and gas reservoirs in the U.S. as well as conventional projects across the globe. U.S. onshore drilling and completion activities typically experience a seasonal decline at end of the year with activity levels increasing at the beginning of the year. Average rig count in the U.S. land market for the three months ended June 30, 2025, was down by 4% year-over-year and 3% sequentially. International rig count was down 7% year-over-year and relatively flat sequentially.

Revenue from the Production Enhancement operating segment of $43.9 million for the three months ended June 30, 2025, decreased 1% year-over-year and increased 3% sequentially. Year-over-year, the decrease was primarily due to lower product sales in the U.S. land market. This decrease was substantially offset by increased revenue in bulk shipments in the international market and a growth in well completion diagnostic services in the U.S. and international markets. Sequentially, the increase was primarily driven by increased product sales in international markets, however this was partially offset by a lower revenue in well completion diagnostic services for projects in the Gulf of Mexico.

Revenue from the Production Enhancement operating segment of $86.6 million for the six months ended June 30, 2025, decreased 3% from the same period in the prior year. The decrease in revenue primarily driven by lower product sales in the U.S. land and international markets in 2025, partially offset by higher revenue in well completion diagnostic services in the U.S. and international markets.

Operating income of $3.1 million for the three months ended June 30, 2025, decreased $1.3 million year-over-year, and increased $1.6 million sequentially. Operating margins for the three months ended June 30, 2025, were 7%, compared to operating margins of 10% year-over-year and 4% sequentially. Year-over-year, the decrease in operating income and margins was primarily driven by a total charge of $1.3 million associated with employee severance, facility consolidation and inventory write-downs in 2025, compared to $0.3 million in 2024. Sequentially, the increase in operating income and margins was

[<u>Return to Index</u>](#index)

------

primarily due to 1) incremental revenue of $1.2 million in the three months ended June 30, 2025, 2) certain employee severance and facility consolidation costs of $0.5 million recorded in the prior quarter, and no such transaction in the current quarter; and 3) a $1.1 million increase the first quarter of 2025, due to the acceleration of stock compensation expense for retirement of eligible executives. These increases partially offset by inventory write-downs of $0.8 million recorded in the second quarter of 2025, no such transaction recorded in the prior quarter.

Operating income of $4.7 million for the six months ended June 30, 2025, decreased $1.3 million compared to the same period in the prior year. Operating margins for the six months ended June 30, 2025, were 5% compared to operating margins of 7% in the same period of the prior year. The decrease in operating income and margins was primarily due to a higher absorption of fixed costs on a lower revenue base and a higher severance and inventory write-down as discussed above.

**Liquidity and Capital Resources**

**General**

We have historically financed our activities through cash on hand, cash flows from operations, bank credit facilities, equity financing and the issuance of debt. Cash flows from operating activities provide the primary source of funds to finance operating needs, capital expenditures, dividends and our share repurchase program. Our ability to maintain and grow our operating income and cash flow depends, to a large extent, on continued investing activities. We believe our future cash flows from operations, supplemented by our borrowing capacity and the ability to issue additional equity and debt, should be sufficient to fund our debt requirements, capital expenditures, working capital, dividends, share repurchase program and future acquisitions. The Company will continue to monitor and evaluate the availability of debt and equity markets.

We are a holding company incorporated in Delaware. Therefore, we conduct substantially all of our operations through our subsidiaries. Our cash availability is largely dependent upon the ability of our subsidiaries to pay cash dividends or otherwise distribute or advance funds to us and on the terms and conditions of our existing and future credit arrangements. There are no restrictions preventing any of our subsidiaries from repatriating earnings, except for the unrepatriated earnings of our Russian subsidiary which are not expected to be distributed in the foreseeable future, and there are no restrictions or income taxes associated with distributing cash to the parent company through loans or advances. As of June 30, 2025, $21.9 million of our $31.2 million of cash was held by our foreign subsidiaries.

The Company maintains the quarterly dividend of $0.01 per share.

**Cash Flows**

The following table summarizes cash flows (in thousands):

---

| | | | |
|:---|:---|:---|:---|
|  | **Six Months Ended June 30,** | **Six Months Ended June 30,** |  |
|  | **2025** | **2024** | **% Change** |
| Cash flows provided by (used in): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating activities | $20583 | $22676 | (9)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Investing activities | (872) | (2344) | (63)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Financing activities | (7680) | (17757) | (57)% |
| Net change in cash and cash equivalents | $12031 | $2575 | 367% |

---

Comparing the six months ended June 30, 2025 to the same period in the prior year, cash flows provided by operating activities decreased to $20.6 million in 2025 compared to $22.7 million in the same period 2024. Net income generated from operations was lower in 2025, but was partially offset by more efficient utilization in operational working capital in 2025.

Cash flows used in investing activities for the six months ended June 30, 2025 of $0.9 million include proceeds on the sale of assets of $2.2 million, proceeds from insurance recovery associated with the fire incident at the Aberdeen, U.K. facility of $4.7 million and proceeds on company owned life insurance policies of $0.8 million, offset by total capital expenditures of $7.9 million, which includes $1.6 million related to the replacement of assets and the facility which were damaged in the 2024 fire

[<u>Return to Index</u>](#index)

------

incident, and a business acquisition, net of cash acquired of $0.6 million. Cash flows used in investing activities for the six months ended June 30, 2024 of $2.3 million include the funding of $5.9 million for capital expenditures, partially offset by $0.8 million of proceeds from the sale of assets and $2.8 million of net proceeds received from company owned life insurance policies.

Cash flows used in financing activities for the six months ended June 30, 2025 of $7.7 million include a $2.0 million net reduction in long-term debt, quarterly dividends of $0.9 million, and $4.8 million used to repurchase the Company's common stock. Cash flows used in financing activities for the six months ended June 30, 2024 of $17.8 million include a $16.0 million net reduction in long-term debt, quarterly dividends of $0.9 million, and $0.6 million in costs associated with equity transactions.

During the six months ended June 30, 2025, we repurchased 369,230 shares of our common stock for $4.8 million, including rights to 12,454 shares of our common stock to satisfy personal tax liabilities of participants in our stock-based compensation plan for an aggregate purchase price of $168 thousand.

We utilize the non-GAAP financial measure of free cash flow to evaluate our cash flows and results of operations. Free cash flow is defined as net cash provided by operating activities (which is the most directly comparable GAAP measure) less cash paid for capital expenditures. Management believes that free cash flow provides useful information to investors regarding the cash available in the period that was in excess of our needs to fund our capital expenditures and operating activities. Free cash flow is not a measure of operating performance under GAAP and should not be considered in isolation nor construed as an alternative to operating income, net income (loss) or cash flows from operating, investing or financing activities, each as determined in accordance with GAAP. Free cash flow does not represent residual cash available for distribution because we may have other non-discretionary expenditures that are not deducted from the measure. Moreover, since free cash flow is not a measure determined in accordance with GAAP and thus is susceptible to varying interpretations and calculations, free cash flow as presented, may not be comparable to similarly titled measures presented by other companies. The following table reconciles this non-GAAP financial measure to the most directly comparable measure calculated and presented in accordance with GAAP (in thousands):

---

| | | | |
|:---|:---|:---|:---|
|  | **Six Months Ended June 30,** | **Six Months Ended June 30,** |  |
|  | **2025** | **2024** | **% Change** |
| **Free cash flow calculation:** |  |  |  |
| Net cash provided by operating activities | $20583 | $22676 | (9)% |
| Less: Cash paid for capital expenditures - operations | (6259) | (5918) | 6% |
| &nbsp;&nbsp;&nbsp;&nbsp;Free cash flow | $14324 | $16758 | (15)% |

---

Free cash flow for the six months ended June 30, 2025, decreased $2.5 million from $16.8 million for the same period in 2024. The net cash provided by operating activities of $20.6 million during the six months ended June 30, 2025, was derived from a lower level of net income, but is partially offset by more efficient utilization in operational working capital in 2025. Capital expenditures-operations, which exclude capital expenditures of $1.6 million associated with the Aberdeen, U.K. fire incident and are covered by insurance, increased slightly by $0.3 million during the six months ended June 30, 2025 compared to the same period in the prior year.

**Credit Facility, Senior Notes and Available Future Liquidity**

We, along with our wholly owned subsidiary Core Laboratories (U.S.) Interests Holdings, Inc. ("CLIH"), have a secured credit facility, the Eighth Amended and Restated Credit Agreement (as amended, the "Credit Facility") for an aggregate borrowing commitment of $135.0 million with a $50.0 million "accordion" feature. As of June 30, 2025, the Credit Facility has an available borrowing capacity of approximately $108.0 million.

See Note 7 – *Long-term debt, net* of the Notes to the Interim Consolidated Financial Statements, for additional information regarding the renewal of the Credit Facility on July 22, 2025.

[<u>Return to Index</u>](#index)

------

Additionally, we along with CLIH as issuer, have senior notes outstanding that were issued through private placement transactions.

These debt instruments are summarized in the following table (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Interest Rate** | **Maturity Date** | **June 30,<br>2025** | **December 31,<br>2024** |
| Credit Facility |  |  | $16000 | $18000 |
| 2021 Senior Notes Series A <sup>(1)</sup> | 4.09% | January 12, 2026 | 45000 | 45000 |
| 2021 Senior Notes Series B <sup>(1)</sup> | 4.38% | January 12, 2028 | 15000 | 15000 |
| 2023 Senior Notes Series A <sup>(2)</sup> | 7.25% | June 28, 2028 | 25000 | 25000 |
| 2023 Senior Notes Series B <sup>(2)</sup> | 7.50% | June 28, 2030 | 25000 | 25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total long-term debt |  |  | 126000 | 128000 |
| Less: Debt issuance costs |  |  | (1387) | (1889) |
| &nbsp;&nbsp;&nbsp;&nbsp;Long-term debt, net |  |  | $124613 | $126111 |

---

&nbsp;&nbsp;&nbsp;&nbsp;*(1) Interest is payable semi-annually on June 30 and December 30.*

&nbsp;&nbsp;&nbsp;&nbsp;*(2) Interest is payable semi-annually on March 28 and September 28.*

In accordance with the terms of the Credit Facility, our leverage ratio is 1.27, and our interest coverage ratio is 7.22, each for the period ended June 30, 2025. We are in compliance with all covenants contained in our Credit Facility and Senior Notes as of June 30, 2025. Certain of our material, wholly owned subsidiaries are guarantors or co-borrowers under the Credit Facility and Senior Notes. See Note 7 - *Long-term Debt, net* of the Notes to the Interim Consolidated Financial Statements for additional information regarding the terms and financial covenants of the Senior Notes and the Credit Facility.

See Note 11 - *Derivative Instruments and Hedging Activities* of the Notes to the Interim Consolidated Financial Statements, for additional information regarding interest rate swap agreements we have entered to fix the underlying risk-free rate on our Credit Facility and the 2023 Senior Notes.

**Item 3. Quantitative and Qualitative Disclosures About Market Risk**

There have been no material changes in market risk from the information provided in Item 7A. "Quantitative and Qualitative Disclosures About Market Risk" of Core Laboratories Inc.'s Annual Report on Form 10-K for the year ended December 31, 2024.

**Item 4. Controls and Procedures**

A complete discussion of our controls and procedures is included in Core Laboratories Inc.'s Annual Report on Form 10-K for the year ended December 31, 2024.

**Disclosure Controls and Procedures**

Our management, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of June 30, 2025, at the reasonable assurance level.

Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. Further, the design of disclosure controls and internal control over financial reporting must

[<u>Return to Index</u>](#index)

------

reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

**Changes in Internal Control Over Financial Reporting**

There have been no changes in our system of internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during the fiscal quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**CORE LABORATORIES INC.**

**PART II - OTHER INFORMATION**

**Item 1. Legal Proceedings** 

See Note 9 - *Commitments and Contingencies* of the Notes to the Interim Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report.

**Item 1A. Risk Factors** 

Our business faces many risks. Any of the risks discussed in this Quarterly Report or our other SEC filings could have a material impact on our business, financial position or results of operations.

Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also impair our business operations. For a detailed discussion of the risk factors that should be understood by any investor contemplating investment in our securities, please refer to "Item 1A - Risk Factors" in Core Laboratories Inc.'s Annual Report on Form 10-K for the year ended December 31, 2024. In addition to the risk factors identified in our 2024 Annual Report, we updated the following risk factor:

***Tariffs and other trade measures could adversely affect our business, results of operations, financial position and cash flows.***

Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. Our input costs for raw materials and other goods, such as steel, electronic components, chemical reagents and laboratory equipment, are adversely affected by tariffs imposed by the U.S. government on products imported into the United States. Additionally, we sell our products internationally and our product sales may be subject to any retaliatory measures by other countries. Any imposition of or increase in tariffs on the goods we purchase or the products we sell could increase our costs and the price of our products and services. To the extent we are unable to pass all or a portion of these cost increases on to our customers, such cost increases could adversely affect our results of operations.

Additional tariffs, further trade restrictions and retaliatory trade measures could disrupt our supply chain and logistics, restrict or limit the availability of goods or supplies, cause adverse financial impacts due to volatility in foreign exchange rates and interest rates, and inflationary pressures on raw materials. It may be time-consuming and expensive for us to alter our business operations to adapt to or comply with any changes in international trade policies and agreements and any failure to do so could have a material adverse effect on our business. Any potential impact will depend on future developments with respect to trade policy and the results of trade negotiations, all of which are beyond our control. These potential impacts, while uncertain, could adversely affect our business, results of operations and financial condition.

Tariffs or other trade restrictions may lead to continuing uncertainty and volatility in U.S. and global financial and economic conditions and commodity markets, declining consumer confidence, significant inflation and diminished expectations for the

[<u>Return to Index</u>](#index)

------

economy, and ultimately reduced demand for our products and services and the demand for crude oil and gas. Such conditions could have a material adverse impact on our business, results of operations and cash flows.

**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds**

**Unregistered Sales of Equity Securities**

None.

**Issuer Purchases of Equity Securities**

The following table provides information about our purchases of shares of our common stock, par value $0.01, that are registered by us pursuant to Section 12 of the Exchange Act during the three months ended June 30, 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Period** | **Total Number<br>of Shares<br>Purchased** | **Average Price<br>Paid Per<br>Share** | **Total Number of Shares<br>Purchased as Part of a<br>Publicly Announced<br>Program** <sup>(2)</sup> | **Maximum Number of<br>Shares That May Yet be<br>Purchased Under the<br>Program** <sup>(2)</sup> |
| April 1-30, 2025 <sup>(1)</sup> | 139435 | $11.70 |  |  |
| May 1-31, 2025 <sup>(1)</sup> | 83197 | $11.13 |  |  |
| June 1-30, 2025 <sup>(1)</sup> | 15000 | $12.14 |  |  |
| Total | 237632 | $11.52 |  |  |

---

(1)During the three months ended June 30, 2025, 10,331 shares were surrendered to us by participants in a stock-based compensation plan to settle any personal tax liabilities which may result from the award. Additionally, we purchased 227,301 shares in the open market. Repurchases of common stock are at the discretion of the board of directors and management.

(2)The Company does not have a formal share repurchase program; however, it does from time to time undertake share repurchases in the open market at the discretion of Company management and with prior authorization from the Board of Directors.

**Item 5. Other Information**

During the three months ended June 30, 2025, no director or officer of the Company adopted, modified or terminated any "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" within the meaning of Item 408(a) of Item 408 of Regulation S-K.

[<u>Return to Index</u>](#index)

------

**Item 6. Exhibits**

---

| | | |
|:---|:---|:---|
| **Exhibit**<br>**No.** | **Exhibit Title** | **Incorporated by**<br>**reference from the**<br>**following documents** |
| 10.1 | [<u>Ninth Amended and Restated Credit Agreement, dated as of July 22, 2025, among Core Laboratories Inc., Core Laboratories (U.S.) Interests Holding, Inc., and the lenders party thereto and Bank of America, N.A. as administrative agent</u>](https://www.sec.gov/Archives/edgar/data/1958086/000095017025097897/clb-ex10_1.htm) | Form 8-K, July 23, 2025 (File No. 001-41695) |
| 31.1 | [<u>Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002</u>](clb-ex31_1.htm) | Filed herewith |
| 31.2 | [<u>Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002</u>](clb-ex31_2.htm) | Filed herewith |
| 32.1 | [<u>Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002</u>](clb-ex32_1.htm) | Furnished herewith |
| 32.2 | [<u>Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002</u>](clb-ex32_2.htm) | Furnished herewith |
| 101.INS | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | Filed herewith |
| 101.SCH | Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents | Filed herewith |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | Filed herewith |

---

[<u>Return to Index</u>](#index)

------

**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant, Core Laboratories Inc., has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

| | | | |
|:---|:---|:---|:---|
|  |  | **CORE LABORATORIES INC.** | **CORE LABORATORIES INC.** |
| Date: | July 24, 2025 | By: | /s/ Christopher S. Hill |
|  |  |  | Christopher S. Hill |
|  |  |  | Chief Financial Officer |
|  |  |  | (Duly Authorized Officer and |
|  |  |  | Principal Financial Officer) |

---

[<u>Return to Index</u>](#index)

------

## Exhibit 31.1

**Exhibit 31.1**

Certification

I, Lawrence V. Bruno, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Core Laboratories Inc. (the "Registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5. The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

---

| | | | |
|:---|:---|:---|:---|
| Date: | July 24, 2025 | By: | /s/ Lawrence V. Bruno |
|  |  |  | Lawrence V. Bruno |
|  |  |  | Chief Executive Officer |

---

------

## Exhibit 31.2

**Exhibit 31.2**

Certification

I, Christopher S. Hill, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Core Laboratories Inc. (the "Registrant");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5. The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

---

| | | | |
|:---|:---|:---|:---|
| Date: | July 24, 2025 | By: | /s/ Christopher S. Hill |
|  |  |  | Christopher S. Hill |
|  |  |  | Chief Financial Officer |

---

------

## Exhibit 32.1

**Exhibit 32.1**

Certification of

Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Lawrence V. Bruno, Chief Executive Officer of Core Laboratories Inc. (the "Company"), hereby certify that the accompanying report on Form 10-Q for the quarter ended June 30, 2025, filed by the Company with the Securities and Exchange Commission on the date hereof fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, (the "Report").

I further certify that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | | |
|:---|:---|:---|:---|
| Date: | July 24, 2025 | /s/ Lawrence V. Bruno | /s/ Lawrence V. Bruno |
|  |  | Name: | Lawrence V. Bruno |
|  |  | Title: | Chief Executive Officer |

---

------

## Exhibit 32.2

**Exhibit 32.2**

Certification of

Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Christopher S. Hill, Chief Financial Officer of Core Laboratories Inc. (the "Company"), hereby certify that the accompanying report on Form 10-Q for the quarter ended June 30, 2025, filed by the Company with the Securities and Exchange Commission on the date hereof fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, (the "Report").

I further certify that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | | |
|:---|:---|:---|:---|
| Date: | July 24, 2025 | /s/ Christopher S. Hill | /s/ Christopher S. Hill |
|  |  | Name: | Christopher S. Hill |
|  |  | Title: | Chief Financial Officer |

---

------