Expro N : 2023 Statutory Dutch Annual Report

EXPRO GROUP HOLDINGS N.V.

Annual Report for the year ended December 31, 2023

Mastenmakersweg 1, 1786 PB

Den Helder

The Netherlands

25 April 2024

Deloitte Accountants B.V.

For identification purposes only. Related to auditor's report dated 25 April 2024

Notice to Shareholders: This annual report is prepared in accordance with the International Financial Reporting Standards as adopted by the European Union and the Dutch Civil Code It does not contain all of the information that is required in our Annual Report on Form 10-K that is prepared in accordance with U.S. SEC regulations. Investors should consult our Annual Report on Form 10-K for additional information.

Deloitte Accountants B.V.

For identification purposes only. Related to auditor's report dated 25 April 2024

EXPRO GROUP HOLDINGS N.V.

ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2023

TABLE OF CONTENTS

Management Board Report	1
Financial Statements
Consolidated Financial Statements
Consolidated statement of comprehensive income for December 31, 2023	53
Consolidated statement of changes in equity for December 31, 2023	54
Consolidated statement of financial position as of December 31, 2023	55
Consolidated statement of cash flows for December 31, 2023	57
Notes to the consolidated financial statements for December 31, 2023	59
Company Financial Statements
Company profit and loss account for 2023	118
Company balance sheet as of December 31, 2023	119
Notes to the company financial statements	120
Other information
Company's branches	129
Provision in the articles of association governing the appropriation of profits	135
Independent Auditor's Report	136

Deloitte Accountants B.V.

For identification purposes only. Related to auditor's report dated 25 April 2024

Management Board Report

The management of Expro Group Holdings N.V. ("Expro") herewith submits its annual report for the year 2023. It is noted that the relevant sections on the activities and functioning of the management board reports have been prepared in cooperation with the board of directors ("Board") and is also deemed to constitute a supervisory board report as meant in the Dutch Corporate Governance Code.

Introduction

Expro Group Holdings N.V. is a Netherlands limited liability company (Naamloze Vennootschap) and includes the activities of the Company and its wholly owned subsidiaries (either individually or together, as context requires, "Expro," the "Company," "Group", "we," "us" and "our").

On March 10, 2021, the Company and New Eagle Holdings Limited, an exempted company limited by shares incorporated under the laws of the Cayman Islands and a direct wholly owned subsidiary of the Company ("Merger Sub"), entered into an Agreement and Plan of Merger with Expro Group Holdings International Limited ("Legacy Expro") providing for the merger of Legacy Expro with and into Merger Sub in an all-stock transaction, with Merger Sub surviving the merger as a direct, wholly owned subsidiary of the Company (the "Merger"). The Merger closed on October 1, 2021, and the Company, previously known as Frank's International N.V. ("Frank's"), was renamed Expro Group Holdings N.V. The Merger has been accounted for using the acquisition method of accounting with Legacy Expro being identified as the accounting acquirer. The historical financial statements presented in this Annual Report reflect the financial position, results of operations and cash flows of only Legacy Expro for all periods prior to the Merger and of the combined company (including activities of Frank's) for all periods subsequent to the Merger.

With roots dating to 1938, the Company is a leading provider of energy services, offering cost-effective, innovative solutions and what the Company considers to be best-in-class safety and service quality. The Company's extensive portfolio of capabilities spans well construction, well flow management, subsea well access, and well intervention and integrity solutions. The Company provides services in many of the world's major offshore and onshore energy basins, with over 100 locations and operations in approximately 60 countries. The Company's broad portfolio of products and services provides solutions to enhance production and improve recovery across the well lifecycle, from exploration through abandonment.

The reporting currency of the consolidated financial statements for Expro is the United States dollar ("USD").

Performance in 2023

The year ended December 31, 2023 has seen continued growth and increased activity as the market rebounds from the effects of the COVID-19 pandemic and Russia's invasion of Ukraine, with limited effect currently from the heightened tensions resulting from the ongoing conflicts in the Middle East. There are a number of market factors that have had, and may continue to have, an effect on our business, including:

• The market for energy services and our business are substantially dependent on the price of oil and, to a lesser extent, the regional price of gas, which are both driven by market supply and demand. Changes in oil and gas prices impact customer willingness to spend on exploration and appraisal, development, production, and abandonment activities. The extent of the impact of a change in oil and gas prices on these activities varies extensively between geographic regions, types of customers, types of activities and the financial returns of individual projects.
• By the fourth quarter of 2023 average daily oil demand exceeded average daily demand levels in 2022, with liquid demand recovering to annualized 2019 levels in 2023. Brent crude oil prices have been returning to mid-year levels (average $75/bbl in June) through the fourth quarter, declining from an average of $91/bbl in October to an average of $78/bbl in December. The Brent price decrease came despite the announcement of an extension by Organization of Petroleum Exporting Countries and certain other oil producing nations ("OPEC+") of supply cuts amid ongoing concerns

Deloitte Accountants B.V.

1For identification purposes only. Related to auditor's report dated 25 April 2024

about global oil demand growth and rising global oil inventories, which were estimated to increase by 0.8 million b/d in the fourth quarter.

• Activity related to gas and liquified natural gas ("LNG") production (and associated asset development) continues to grow within our ESSA and MENA regions in support of Europe's ongoing drive to diversify away from its reliance on Russian pipeline gas supplies over the long term. More broadly, the energy security and transition imperatives of policymakers in the U.S. and Europe are expected to result in increased investment in global gas development.
• International, offshore and deepwater activity continued to strengthen throughout 2023 as operator upstream investments increased to pre-pandemic levels. We also experienced an increased demand for services and solutions related to brownfield and production enhancement and infield development programs as operators strive to maximize their previous investments and maintain production with a lower carbon footprint. In addition, we have seen an increase in demand for early production facilities and production optimization technologies, especially in support of gas and LNG developments.
• The clean energy transition continues to gain momentum. We believe, however, that hydrocarbons, and natural gas in particular, will continue to play a vital role in the transition towards more sustainable energy resources, and the existing expertise and future innovation within the energy services sector, both to reduce emissions and enhance efficiency, will be critical. We are already active in the early-stage carbon capture and storage segment and have expertise and established operations within the geothermal and flare reduction segments. We continue to develop technologies to enhance the sustainability of our customers' operations which, along with our digital transformation initiatives, are expected to enable us to continue to support our customers' commercial and environmental initiatives. As the industry changes, we continue to evolve our approach to adapt and help our customers develop more sustainable energy solutions.

We reported a net loss for the year ended December 31, 2023 of $24.1 million, compared to a net loss of $21.7 million for the year ended December 31, 2022. The increase in net loss primarily reflects, higher depreciation and amortization expense of $39.0 million, higher corporate costs of $18.3 million, higher interest and finance expense of $3.6 million, higher other expense of $3.4 million, lower equity in income of joint ventures by $2.9 million, higher stock-based compensation expense of $1.8 million, higher income tax expense of $1.4 million, and higher foreign exchange loss of $0.9 million, partially offset higher Segment EBITDA of $66.0 million (as defined in Note 5 "Business segment reporting").

Net turnover was $1,512.8 million, an increase of $233.4 million as compared to 2022. Activity and revenue across all our geography-based operating segments also increased during the year ended December 31, 2023, most notably in Europe and Sub-Saharan Africa ("ESSA").

During the year ended December 31, 2023, the Company acquired DeltaTek Oil Tools Limited and Professional Rental Tools, LLC. Please refer to Note 3 "Business combinations and dispositions" to the consolidated financial statements for additional information.

Missions and Objectives

With roots dating to 1938, the Company is a leading provider of energy services, offering cost-effective, innovative solutions and what the Company considers to be best-in-class safety and service quality. The Company's extensive portfolio of capabilities spans well construction, well flow management, subsea well access, and well intervention and integrity solutions. The Company provides services in many of the world's major offshore and onshore energy basins, with operations in approximately 60 countries. The Company's broad portfolio of products and services provides solutions to enhance production and improve recovery across the well lifecycle, from exploration through abandonment.

Deloitte Accountants B.V.

2For identification purposes only. Related to auditor's report dated 25 April 2024

Our operations are comprised of four operating segments which also represent our reporting segments and are aligned with our geographic regions as follows:

• North and Latin America ("NLA"),
• Europe and Sub-Saharan Africa ("ESSA"),
• Middle East and North Africa ("MENA"), and
• Asia-Pacific("APAC").

Corporate Strategy

Our corporate strategy is designed to leverage existing capabilities and position Expro as a solutions provider with a technologically differentiated offering. In particular, our objectives for 2024, which we expect will drive our performance in the year ahead, include: (i) exceeding industry expectations in regard to safety and operational performance; (ii) advancing our products and services portfolio to provide customers with cost-effective, innovative solutions to produce oil, gas and geothermal resources more efficiently and with a lower carbon footprint; (iii) sustaining our relentless drive for efficiency and better utilizing existing assets; (iv) nurturing our culture based on core values and agreed behaviors, empowering our people to be innovative, to be agile and responsive, and to embrace diversity; and (v) leveraging the power of data to improve our own business practices and to deliver more value to our customers.

Environmental Compliance

Our operations are subject to numerous and complex laws and regulations governing the emission and discharge of materials into the environment, occupational health and safety aspects of our operations, or otherwise relating to environmental protection. Failure to comply with these laws or regulations or to obtain or comply with permits may result in the assessment of sanctions, including administrative, civil and criminal penalties, imposition of investigatory, remedial or corrective actions, the required incurrence of capital expenditures, the occurrence of restrictions, delays or cancellations in the permitting, development or expansion of projects, and the imposition of orders or injunctions to prohibit or restrict certain activities or force future compliance.

Certain environmental laws may impose joint and several strict liability, without regard to fault or the legality of the original conduct, on classes of persons who are considered to be responsible for the release of a hazardous substance into the environment. The trend in environmental regulation is to typically place more stringent restrictions and limitations on activities that may impact the environment, and thus, any changes in environmental laws and regulations or in enforcement policies that result in more stringent and costly waste handling, storage, transport, disposal, or remediation requirements could have a material adverse effect on our operations and financial position. Moreover, accidental releases or spills of regulated substances may occur in the course of our operations, and we cannot assure that we will not incur significant costs and liabilities as a result of such releases or spills, including any third-party claims for damage to property, natural resources or persons.

The following is a summary of the more significant existing environmental and occupational health and safety laws and regulations to which our business operations are subject and for which compliance could have a material adverse impact on our capital expenditures, results of operations or financial position.

Climate Change

Climate change continues to attract considerable attention in the U.S. and other countries. Numerous proposals have been made and could continue to be made at the international, national, regional and state levels of government to monitor and limit existing emissions of greenhouse gases ("GHGs") as well as to restrict or eliminate such future emissions. As a result, our operations are subject to a series of regulatory, political, litigation, and financial risks associated with the transport of fossil fuels and emission of GHGs.

Deloitte Accountants B.V.

3For identification purposes only. Related to auditor's report dated 25 April 2024

Separately, various governments have adopted or are considering adopting legislation, regulations or other regulatory initiatives that are focused on such areas as GHG cap and trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions. At the international level, there is a non-binding agreement, the United Nations-sponsored "Paris Agreement," for nations to limit their GHG emissions through individually-determined reduction goals every five years after 2020. Under the Paris Agreement, the Biden Administration has committed the United States to reducing its greenhouse gas emissions by 50 - 52% from 2005 levels by 2030. In November 2021, the U.S. and other countries entered into the Glasgow Climate Pact, which includes a range of measures designed to address climate change, including but not limited to the phase-out of fossil fuel subsidies, reducing methane emissions by 30% by 2030, and cooperating toward the advancement of the development of clean energy. Executive orders may be issued or federal legislation or regulatory initiatives may be adopted to achieve the agreement's goals. Within the U.S., President Biden signed into law the Inflation Reduction Act in August 2022, which contains tax inducements and other provisions that incentivize investment, development, and deployment of alternative energy sources and technologies, which could increase operating costs within the oil and gas industry and accelerate the transition away from fossil fuels. Within the Netherlands, in April 2023, the Dutch government introduced a package of 120 measures worth €28 billion that is intended to reduce carbon emissions and promote clean energy to meet the EU's target of reducing net emissions by 55% by 2030 from 1990 levels.

There are also increasing risks of litigation related to climate change effects. Governments and third-parties have brought suit against some fossil fuel companies alleging, among other things, that such companies created public nuisances by marketing fuels that contributed to global warming effects, such as rising sea levels, and therefore are responsible for roadway and infrastructure damages as a result, or alleging that the companies have been aware of the adverse effects of climate change for some time but defrauded their investors by failing to adequately disclose those impacts. Similar or more demanding cases are occurring in other jurisdictions where we operate. For example, in December 2019, the High Council of the Netherlands ruled that the government of the Netherlands has a legal obligation to decrease the country's GHG emissions, and in May 2021, the Hague District Court ordered Royal Dutch Shell plc to reduce its worldwide emissions by 45% by 2030 compared to 2019 levels. Such litigation has the potential to adversely affect the production of fossil fuels, which in turn could result in reduced demand for our services.

Financial risks also exist for fossil fuel producers (and companies that provide products and services to fossil fuel producers) as shareholders who are currently invested in such fossil fuel companies but are concerned about the potential effects of climate change may elect in the future to shift some or all of their investments into other sectors. Banks and institutional lenders that provide financing to fossil fuel companies (and their suppliers and service providers) also have become more attentive to sustainable lending practices and some of them may elect not to provide funding for fossil fuel companies. Additionally, in recent years, the practices of institutional lenders have been the subject of intensive lobbying efforts not to provide funding for such companies. Oftentimes this pressure has been public in nature, by environmental activists, proponents of the international Paris Agreement, and foreign citizenry concerned about climate change. Limitation of investments in and financings for fossil fuel companies could result in the restriction, delay or cancellation of production of crude oil and natural gas, which could in turn decrease demand for our services. Our own operations could also face limitations on access to capital as a result of these trends, which could adversely affect our business and results of operation.

The adoption and implementation of new or more stringent international, federal or state legislation, regulations or other regulatory initiatives that impose more stringent standards for GHG emissions from the oil and natural gas sector or otherwise restrict the areas in which this sector may produce oil and natural gas or generate GHG emissions could result in increased costs of compliance or costs of consuming, and thereby reduce demand for, oil and natural gas, which could reduce demand for our services and products. Additionally, political, litigation and financial risks may result in our oil and natural gas customers restricting or canceling production activities, incurring liability for infrastructure damages as a result of climatic changes, or impairing their ability to continue to operate in an economic manner, which also could reduce demand for our services and products. Moreover, the increased competitiveness of alternative energy sources (such as wind, solar, geothermal, tidal and biofuels) could reduce demand for hydrocarbons, and therefore for our products and services, which would lead to a reduction

Deloitte Accountants B.V.

4For identification purposes only. Related to auditor's report dated 25 April 2024

in our revenues. Over time, one or more of these developments could have a material adverse effect on our business, financial condition and results of operations.

Hydraulic Fracturing

Hydraulic fracturing is an important and common practice in the oil and gas industry. The process involves the injection of water, sand and chemicals under pressure into a formation to fracture the surrounding rock and stimulate production of hydrocarbons. While we may provide supporting products through our cementing product offering, we do not perform hydraulic fracturing, but many of our onshore customers utilize this technique. Certain environmental advocacy groups and regulatory agencies have suggested that additional federal, state and local laws and regulations may be needed to more closely regulate the hydraulic fracturing process, and have made claims that hydraulic fracturing techniques are harmful to surface water and drinking water resources and may cause earthquakes. Various governmental entities (within and outside the U.S.) are in the process of studying, restricting, regulating or preparing to regulate hydraulic fracturing, directly or indirectly. Additionally, states and local governments may also seek to limit hydraulic fracturing activities through time, place, and manner restrictions on operations or ban the process altogether. The adoption of legislation or regulatory programs that restrict hydraulic fracturing could adversely affect, reduce or delay well drilling and completion activities, increase the cost of drilling and production, and thereby reduce demand for our services. There also exists the potential for states and local governments to pursue new or amended laws, regulations, executive actions and other regulatory initiatives that could impose more stringent restrictions on hydraulic fracturing, including potential restrictions on hydraulic fracturing by banning new oil and gas permitting on federal lands.

Offshore Regulatory and Marine Safety

Spurred on by environmental and safety concerns, governing bodies from time to time have pursued moratoria and legislation or regulatory initiatives that would materially limit or prohibit offshore drilling in certain areas, including areas where we or our oil and gas exploration and production customers conduct operations such as on the federal Outer Continental Shelf waters in the U.S. and Gulf of Mexico.

Employee Health and Safety

We are subject to a number of federal and state laws and regulations, including the Occupational Safety and Health Act and comparable state statutes, establishing requirements to protect the health and safety of workers. In addition, the U.S. Occupational Safety and Health Administration hazard communication standard, the EPA community right-to-know regulations under Title III of the federal Superfund Amendment and Reauthorization Act and comparable state statutes require that information be maintained concerning hazardous materials used or produced in our operations and that this information be provided to employees, state and local government authorities and the public. Substantial fines and penalties can be imposed and orders or injunctions limiting or prohibiting certain operations may be issued in connection with any failure to comply with laws and regulations relating to worker health and safety.

We also operate in non-U.S. jurisdictions, which may impose similar legal requirements. Historically, our environmental and worker safety costs to comply with existing environmental laws and regulations have not had a material adverse impact on us. However, we believe that it is reasonably likely that the trend in environmental legislation and regulation will continue toward stricter standards and, thus, we cannot give any assurance that such costs will not materially adversely affect us in the future.

Operating Risk and Insurance

We maintain insurance coverage of types and amounts that we believe to be customary and reasonable for companies of our size and with similar operations. In accordance with industry practice, however, we do not maintain insurance coverage against all of the operating risks to which our business is exposed. Therefore, there is a risk our insurance program may not be sufficient to cover any particular loss or all losses.

Deloitte Accountants B.V.

5For identification purposes only. Related to auditor's report dated 25 April 2024

Currently, our insurance program includes, among other things, general liability, umbrella liability, sudden and accidental pollution, personal property, vehicle, workers' compensation, and employer's liability coverage. Our insurance includes various limits and deductibles or retentions, which must be met prior to or in conjunction with recovery. We generally do not procure or maintain business interruption insurance.

Liquidity, Capital Resources and Financing

Our financial objectives include the maintenance of sufficient liquidity, adequate financial resources and financial flexibility to fund our business. As of December 31, 2023, total available liquidity was $298.4 million, including cash and cash equivalents and restricted cash of $151.7 million and $146.7 million available for borrowings under our Amended and Restated Facility Agreement. Expro believes these amounts, along with cash generated by ongoing operations, will be sufficient to meet future business requirements for the next 12 months and beyond. Our primary sources of liquidity have been cash flows from operations. Our primary uses of capital have been for capital expenditures, acquisitions and repurchases of company stock. We monitor potential capital sources, including equity and debt financing, in order to meet our investment and liquidity requirements. The solvency ratio (total equity divided by total equity and liabilities) was 0.65 and 0.67 as of the years ended December 31, 2023 and 2022.

Our total capital expenditures are estimated to range between $130.0 million and $140.0 million for 2024. Our total capital expenditures were $122.1 million for the year ended December 31, 2023, out of which approximately 90% were used for the purchase or manufacture of equipment to directly support customer-related activities and approximately 10% for other property, plant and equipment, inclusive of software costs. The actual amount of capital expenditures for the purchase and manufacture of equipment may fluctuate based on market conditions. We continue to focus on preserving and protecting our strong balance sheet, optimizing utilization of our existing assets and, where practical, limiting new capital expenditures.

On October 25, 2023, the Board approved an extension to the stock repurchase program first approved on June 16, 2022. Pursuant to the extended stock repurchase program, we are authorized to acquire up to $100.0 million of our outstanding common stock from October 25, 2023 through November 24, 2024 (the "Stock Repurchase Program"). Under the Stock Repurchase Program, we may repurchase shares of our common stock in open market purchases, in privately negotiated transactions or otherwise. The Stock Repurchase Program will continue to be utilized at management's discretion and in accordance with federal securities laws. The timing and actual numbers of shares repurchased will depend on a variety of factors including price, corporate requirements, the constraints specified in the Stock Repurchase Program along with general business and market conditions. The Stock Repurchase Program does not obligate the Company to repurchase any particular amount of common stock, and it could be modified, suspended or discontinued at any time. During the year ended December 31, 2023, under the Stock Repurchase Program we repurchased 1.2 million shares of our common stock at an average price of $16.70 for a total cost of approximately $20.0 million, including shares repurchased prior to the extension of the Stock Repurchase Program. During the year ended December 31, 2022, we repurchased 1.1 million shares at an average price of $11.81 per share, for a total cost of $13.0 million under the preceding program.

The timing, declaration, amount of, and payment of any dividends is within the discretion of our Board and will depend upon many factors, including our financial condition, earnings, capital requirements, covenants associated with our asset based revolving credit facility, legal requirements, regulatory constraints, industry practice, ability to access capital markets, and other factors deemed relevant by our Board. We do not have a legal obligation to pay any dividend and there can be no assurance that we will be able to do so.

Research and Development

Deloitte Accountants B.V.

6For identification purposes only. Related to auditor's report dated 25 April 2024

Our research and development ("R&D") activities are related to spending for new product development and innovation and includes internal engineering, materials, and third-party costs.

Credit Facility

Revolving Credit Facility

On October 6, 2023, we amended and restated our previous facility agreement pursuant to an amendment and restatement agreement (the "Amended and Restated Facility Agreement") with DNB Bank ASA, London Branch, as agent in order to extend the maturity of the Amended and Restated Facility Agreement for a further 36 months and increase the total commitments to $250.0 million, of which $166.7 million was available for drawdowns as loans and $83.3 million was available for letters of credit. The Company has the ability to increase the commitments to $350.0 million.

Cash Flows from Operating, Investing and Financing Activities

The following table summarizes cash flows from operations, investing and financing activities for the years ended December 31,

2023 and 2022 (in thousands):

		Years ended December 31,
		2023			2022
Cash provided by / (used in):
Operating activities	$	169,933	$	108,302
Investing activities		(141,526)			(66,114)
Financing activities		(87,669)			(58,837)
Exchange losses on cash and cash equivalents		(6,032)			(4,738)
Net change in cash and cash equivalents	$	(65,294)	$	(21,387)

Net cash provided by operating activities was $169.9 million during the year ended December 31, 2023 as compared to $108.3 million during the year ended December 31, 2022. The increase of $61.6 million in net cash provided by operating activities is primarily driven by improvements in Segment EBITDA of $66.0 million, favorable movement in working capital of $29.7 million, partially offset by a decrease in payments of taxes of $13.1 million.

Net cash used in investing activities was $141.5 million during the year ended December 31, 2023, as compared to net cash used in investing activities of $66.1 million during the year ended December 31, 2022. Our principal recurring investing activity is our capital expenditures, which increased by $41.5 million. The remaining increase in net cash provided by investing activities was primarily due to payment for acquired businesses, net of cash acquired, of $28.7 million, lower proceeds from sale/maturity of investments by $10.8 million and lower proceeds from disposal of assets of $5.2 million. In addition, cash used to acquire technology of $7.9 million during 2022 was not repeated in 2023.

Net cash used in financing activities was $87.7 million during the year ended December 31, 2023, as compared to $58.8 million during the year ended December 31, 2022. The increase of $28.9 million in cash used by financing activities primarily due to net repayments of long term borrowings of $15.1 million and an increase in the repurchase of our common stock of $7.0 million.

Personnel

As of December 31, 2023, we had approximately 8,000 employees (including contractors) worldwide (including 78 Netherland domiciled employees). We are a party to collective bargaining agreements or other similar arrangements in certain international areas in which we operate. As of December 31, 2023, approximately 19% of our employees were subject to collective bargaining agreements, with 15% being under agreements that expire within one year. We consider our relations with our employees to be positive. In the United States of America ("U.S."), where approximately 17% of our employees are located, most employees

Deloitte Accountants B.V.

7For identification purposes only. Related to auditor's report dated 25 April 2024