McCoy Global : 2023 Year End Management's Discussion & Analysis

MANAGEMENT'S DISCUSSION AND

ANALYSIS

For the year ended December 31, 2023

TABLE OF CONTENTS
EXPLANATORY NOTES	2
STRATEGIC ACHIEVEMENTS	5
OUTLOOK AND FORWARD-LOOKING INFORMATION	6
MARKET CONDITIONS	7
BUSINESS VISION	9
FINANCIAL RESULTS	11
SUMMARY OF CONSOLIDATED FOURTH QUARTER RESULTS	11
SUMMARY OF QUARTERLY RESULTS	14
SUMMARY OF CONSOLIDATED ANNUAL RESULTS	15
LIQUIDITY AND CAPITAL RESOURCES	18
FINANCIAL RISK MANAGEMENT	20
OTHER FINANCIAL INFORMATION	20
CONTRACTUAL OBLIGATIONS	20
OUTSTANDING SHARE DATA	21
CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS	21
FUTURE ACCOUNTING PRONOUNCEMENTS	22
CONTROLS AND PROCEDURES	23
DISCLOSURE CONTROLS AND PROCEDURES ("DC&P")	23
INTERNAL CONTROLS OVER FINANCIAL REPORTING ("ICFR")	23
RISK AND UNCERTAINTIES RELATED TO THE BUSINESS	24
OTHER INFORMATION	24

EXPLANATORY NOTES

The following Management's Discussion and Analysis of Financial Results ("MD&A"), dated March 13, 2024, should

be read in conjunction with the cautionary statement regarding forward-looking information and statements below, as well as the audited consolidated financial statements and notes thereto, for the years ended December 31, 2023, and 2022. The annual consolidated financial statements have been prepared in accordance with International

Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). All

amounts in the following MD&A are in Canadian dollars unless otherwise stated. References to "McCoy," "McCoy

Global," "the Corporation," "we," "us" or "our" mean McCoy Global Inc. and its subsidiaries, unless the context

otherwise requires. Additional information relating to McCoy Global, including periodic quarterly and annual reports

and Annual Information Forms ("AIF"), filed with Canadian securities regulatory authorities, is available on SEDAR at

sedar.com and our website at mccoyglobal.com.

FORWARD-LOOKING INFORMATION AND STATEMENTS

This MD&A contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-lookingstatements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking information is often, but not always, identified by the use of words such as "could", "should", "can", "anticipate", "expect", "objective", "ongoing", "believe", "will", "may", "projected", "plan", "sustain", "continues", "strategy", "potential", "projects", "grow", "take advantage", "estimate", "well-positioned" or similar words suggesting future outcomes. In particular, this MD&A contains:

Forward-looking statements relating to McCoy Global's:

• business strategy;
• future development and organic growth prospects;
• competitive advantages; and
• merger and acquisition strategy.

Forward-looking statements respecting:

• the business opportunities for the Corporation that are based on the views of management of the Corporation and current and anticipated market conditions; and
• the perceived benefits of the growth and operating strategies of the Corporation; which are based upon the financial and operating attributes of the Corporation as at the date hereof, as well as the anticipated operating and financial results.

Other forward-looking statements regarding the Corporation are located in the documents incorporated by reference in this MD&A and are based on certain key expectations and assumptions of the Corporation concerning anticipated financial performance, business prospects, strategies, the sufficiency of budgeted capital expenditures in carrying out planned activities, the availability and cost of labour and services and the ability to obtain financing on acceptable terms, which are subject to change based on market conditions and potential timing delays. Although management of the Corporation considers these assumptions to be reasonable based on information currently available to them, they may prove to be incorrect.

By their very nature, forward-looking statements involve inherent risks and uncertainties (both general and specific) and risks that forward-looking statements will not be achieved. Undue reliance should not be placed on forward-looking statements, as a number of important factors could cause the actual results to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in the forward-looking statements, including those set out below and those detailed elsewhere in this MD&A:

• oil and natural gas price fluctuations;
• domestic and foreign competition;
• technology;
• replacement or reduced use of products and services;
• international operations and international trade relations;
• global health crisis;

• major operations disruption due to severe weather events;
• ability to effectively manage growth;
• business mergers and acquisitions;
• insurance sufficiency, availability, and rate risk;
• supply chain disruption and increasing material costs;
• reliance on key persons and workforce availability;
• legal compliance;
• litigation;
• breach of confidentiality;
• shareholder activism;
• safety performance;
• foreign exchange;
• availability of financing;
• raising equity through the issuance of shares;
• customers' inability to obtain credit/financing;
• material differences between actual results and management estimates and assumptions;
• Greenhouse Gas ("GHG") regulations and other climate change related measures;
• change in government administrations;
• conservation measures and technological advances;
• terrorist attack or armed conflict;
• sufficiency of internal controls;
• information security and cybersecurity; and
• challenges by taxation authorities.

Readers are cautioned that the foregoing list is not exhaustive.

The reader is further cautioned that the preparation of financial statements in accordance with IFRS requires management to make certain judgments and estimates that affect the reported amounts of assets, liabilities, revenues, and expenses. These judgments and estimates may change, having either a negative or positive effect on net earnings as further information becomes available, and as the economic environment changes.

The information contained in this MD&A, including the documents incorporated by reference herein, identifies additional factors that could affect the operating results and performance of the Corporation. We urge you to carefully consider those factors.

The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this MD&A are made as of the date of this MD&A and the Corporation does not undertake and is not obligated to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

DESCRIPTION OF NON-GAAP MEASURES

Throughout this MD&A, management uses measures which do not have a standardized meaning as prescribed by IFRS and therefore are considered to be non-GAAP measures presented under IFRS.

EBITDA is non-GAAP measure defined as net earnings (loss), before:

• depreciation of property, plant, and equipment;
• amortization of intangible assets;
• income tax expense (recovery); and
• finance charges, net.

Adjusted EBITDA is a non-GAAP measure defined as net earnings (loss), before:

• depreciation of property, plant, and equipment;
• amortization of intangible assets;
• income tax expense (recovery);
• finance charges, net;
• provisions for (recovery of) excess and obsolete inventory;
• other losses (gains), net;
• restructuring charges;
• share-basedcompensation; and
• impairment losses.

Net cash is a non-GAAP measure defined as cash and cash equivalents,

• plus: restricted cash;
• less: borrowings.

The Corporation reports on EBITDA and adjusted EBITDA because they are important measures used by management to evaluate performance. The Corporation believes adjusted EBITDA assists investors in assessing McCoy Global's current operating performance on a consistent basis without regard to non-cash, unusual (i.e. infrequent and not considered part of ongoing operations), or non-recurring items that can vary significantly depending on accounting methods or non-operating factors.

Adjusted EBITDA is not considered an alternative to net earnings or loss in measuring McCoy Global's performance. Adjusted EBITDA does not have a standardized meaning and is therefore not likely to be comparable to similar measures used by other issuers. Adjusted EBITDA should not be used as an exclusive measure of cash flow since it does not account for the impact of working capital changes, capital expenditures, debt changes and other sources and uses of cash, which are disclosed in the consolidated statements of cash flows.

The Corporation reports net cash as it is an important measure used by management to evaluate liquidity. The Corporation believes net cash assists investors in assessing McCoy Global's current liquidity on a consistent basis taking into consideration cash and cash equivalents, restricted cash, and borrowings.

Order intake is a measure of the amount of customer orders the Corporation has received, during a specified period of time, and is therefore an indicator of a base level of future revenue potential. Order intake is not a GAAP measure, and, as a result, the definition and determination of order intake will vary among other issuers. The Corporation defines an order as a customer purchase commitment that has a high certainty of being delivered and is measured on the basis of the receipt of a customer purchase order or customer confirmation of McCoy sales order.

Backlog is a measure of the amount of customer orders the Corporation has received, but has not yet recognized as revenue, and is therefore an indicator of a base level of future revenue potential. Backlog is not a GAAP measure, and, as a result, the definition and determination of backlog will vary among other issuers reporting a backlog figure. The Corporation defines backlog as orders that have a high certainty of being delivered, but have not yet been recognized as revenue, and is measured on the basis of a firm customer commitment, such as the receipt of a purchase order.

STRATEGIC ACHIEVEMENTS

McCoy remains committed to its key strategic objectives and we are pleased to report our progress:

Earnings Performance & Cashflow Generation

Three months ended December 31, 2023

McCoy reported revenue for the three months ended December 31, 2023, of $19.7 million, an 8% increase from the comparative period (Q4 2022 - $18.3 million). The growth in revenues was driven by strong demand for the newly commercialized smart products, particularly McCoy's recently introduced Flush Mount Spider (FMS) in the North American land market.

McCoy's earnings for the fourth quarter of 2023 were $2.7 million, a decrease of $4.6 or 63% from the comparative period (Q4 2022 - $7.3 million). The comparative period benefited from a $3.9 million gain on property, plant and equipment recognized in conjunction with the sale-leaseback of McCoy's facility in Cedar Park, Texas, as well as a $1.0 million recovery of income tax expense, largely from the recovery of previously unrecognized deferred tax assets.

Adjusted EBITDA for the three months ended December 31, 2023, was $4.0 million or 20% of revenue, an increase of $0.3 million from the comparative period (Q4 2022 - adjusted EBITDA of $3.7 million, or 20% of revenue). This growth reflects McCoy's robust operating efficiency, fueled by significant revenue contributions from innovative technologies such as FMS, DWCRTs, and smartCRTTMs, which generally offer higher margins compared to legacy capital equipment. Adjusted EBITDA performance for the fourth quarter of 2023 was impacted by increased revenues and production throughput, offset to a lesser extent by escalated freight costs and adjustments in workforce compensation to support revenue expansion.

Adjusted EBITDA performance supported McCoy's $4.2 million of cashflow generated from operating activities during the fourth quarter of 2023 (Q4 2022 - $4.6 million), which was subsequently used for strategic investments in the Corporation's rental fleet, principal elements of lease payments, returning capital to shareholders through McCoy's quarterly dividend and building the Corporation's net cash balance to $15.7 million.

Year ended December 31, 2023

McCoy reported annual revenue of $69.7 million, or growth of 33% from the previous year. This robust revenue growth was driven by strong demand for recently commercialized products and led to the achievement of $6.5 million in net earnings. McCoy's full-year 2023 adjusted EBITDA was $13.1 million (19% of revenue), a 54% increase from the comparative period (2022 - $8.5 million, 16% of revenue), reaching the highest level since 2014.

McCoy's strong EBITDA performance and cashflow generated from operating activities was used to return capital to shareholders and repay its senior secured credit facility. During the year ended December 31, 2023, the Corporation used $2.5 million of cash to repurchase 1.7 million shares at a weighted average price of $1.47 per share under its successfully completed Normal Course Issuer Bid, and $0.6 million was paid under the Corporation's reinstated quarterly dividend. The Corporation also made $3.4 million of strategic investments into its rental fleet, as well as, to a lesser extent, production equipment and facility upgrades.

Having reported a net cash balance of $15.7 million as at December 31, 2023 (December 31, 2022 - $17.8 million) and $11.1 million of additional funds available under undrawn credit facilities, McCoy is well positioned to take advantage of various strategic opportunities.

Advancing our Digital Technology Roadmap

Since January 1, 2023, we achieved key commercial and development milestones:

Reported thirty-nine (39) commercial sales for McCoy's Flush Mount Spider (FMS) and twenty-three (23) additional tools scheduled for delivery in early 2024. With a growing number of tools delivered in the fourth quarter and coming months, we expect the increased exposure with operators will showcase the benefits of McCoy's FMS, and in turn, further accelerate adoption in the coming quarters. McCoy's FMS is a hydraulic rotary flush mounted spider that when fully connected (smartFMSTM), handles casing while providing

information on the state of the tool to the driller's display in real-time as well as the ability to integrate with McCoy Smart Casing Running Tool (smartCRT™).

Reported two (2) commercial sales for McCoy's smartCRTTM and delivered four (4) rental tools in Latin America to a large multinational customer committed to utilizing our technology. In addition, purchase order commitments were received from a new market entrant in Latin America. The smartCRTTM has successfully executed multiple commercial casing jobs in the Middle East North Africa ("MENA") region, proving the infield application of the tool and display. We expect to continue to build upon the tool's in-field performance record in 2024 and further accelerate customer adoption. McCoy's smartCRTTM is an intelligent, connected enhancement of our conventional casing running tool that offers superior safety, efficiency and simplified operating procedure, with real-time data collection and analysis capabilities. This technology effectively mitigates the risk of human error, while providing actionable insights that optimize future performance.

Completed the development of the smarTRTM and have since began in-field trials with our partnering customer in North America. We expect further advancements toward commercialization and look forward to reporting our progress on key milestones.

Order Intake

McCoy reported $18.0 million of order intake for the three months ended December 31, 2023, a 21% increase over the $14.9 million of order intake reported in the fourth quarter of 2022. Order intake increased sequentially from the $15.4 million reported in the third quarter of 2023, and included strong purchase commitments for McCoy's FMS, with several orders converted to revenue in the quarter due to McCoy's strategic investment in build-plan inventory.

OUTLOOK AND FORWARD-LOOKING INFORMATION

Over the short and medium term, oil & gas market fundamentals remain robust for international markets, especially in the Middle East and North Africa (MENA). Increased drilling activity and the entry of new regional players alongside National Oil Companies' (NOC) strong focus on increased safety and efficiency will create further opportunities for our new products. McCoy is well positioned to capitalize on these trends with market leading technologies and product enhancements that provide superior safety, efficiency and simplified operating procedures, as well as expert technical support with local presence and the broadest portfolio of TRS equipment on the market.

Turning to the North America land market, despite relatively flat rig count and drilling activity, McCoy anticipates continued robust order intake for our new FMS technology in 2024 due to the performance and safety advantages inherent in its unique design, along with the ongoing labour challenges faced by many of our customers.

As we progress through the commercialization stage of our 'Digital Technology Roadmap' initiative, we expect future revenues to become less dependent on the cyclicality of drilling activity, and more driven by technology adoption, demand from new local and regional market entrants, and market share gains in new geographies.

From January 1 to March 13, 2024, order intake amounted to $15.6 million, on pace with Q4 2023 order intake. With $22.5 million (US$17.0 million) of backlog reported at December 31, 2023, we are confident in delivering strong revenue and earnings performance for 2024. However, timing delays experienced on certain customer purchase commitments, shifts in product mix, and greater than anticipated book-and-ship revenues that positively impacted Q4, 2023, may result in quarter-to-quarter fluctuations in revenues and gross margins, particularly in the first quarter, with revenues and earnings more heavily weighted toward the second half of 2024. McCoy remains confident in the continued strong adoption of its new technologies in 2024, and with its proven track record of operational efficiency and cashflow generation, McCoy has since doubled its quarterly dividend to $0.02 per share. For 2024 and beyond, we continue to focus on our key strategic initiatives to deliver value to all our stakeholders:

• Accelerating market adoption of new and recently developed 'smart' portfolio products;
• Taking advantage of the current market trajectory by focusing on revenue generation from new and existing customers;
• Focusing on capital allocation priorities; a) investment in growth through both organic and strategic M&A opportunities where returns are favourable and b) return excess cash to our shareholders in the form of share buy-backs and quarterly dividends.

We believe this strategy, together with our committed and agile team, McCoy's global brand recognition, application expertise, strong balance sheet, and global footprint will further advance McCoy's competitive position and generate strong returns on invested capital.

MARKET CONDITIONS

Management uses active rig counts as well as number and length of wells being drilled as data points to monitor and set expectations of the future performance of the Corporation. Generally, these metrics are leading indicators of demand for McCoy Global's products and services, although there are many factors that may impact any correlation.

A summary of historical and forecasted rig and well counts, which includes both land and offshore, obtained from Spears & Associates Drilling and Production Outlook, December 2023, is as follows:

*Forecasted

**Cumulative

At a macro level, the demand for McCoy Global's products and services is related to drilling activity levels and customers' capital and operating budgets, which in turn are influenced by oil and natural gas prices and expectations as to future price trends. The availability of existing capital equipment adequate to serve drilling activity requirements, or lack thereof, further drives demand levels for McCoy's capital equipment products. The introduction and adoption of new products and technologies is a further driver of capital equipment demand and continues to play a more significant role as the adoption of McCoy's new technologies accelerates.

Backlog

Backlog is a measure of the amount of customer orders the Corporation has received and is therefore an indicator of a base level of future revenue potential. Backlog is not a GAAP measure, and, as a result, the definition and determination of backlog will vary among other issuers reporting a backlog figure.

The Corporation defines backlog as orders that have a high certainty of being delivered and is measured on the basis of a firm customer commitment, such as the receipt of a purchase order. Though customers may default on, or cancel such commitments, purchase commitments may be secured by a deposit and/or require reimbursement by the customer upon default or cancellation. Backlog reflects likely future revenues; however, cancellations or reductions may occur and there can be no assurance that backlog amounts will ultimately be realized as revenue, or that the Corporation will earn a profit on backlog once fulfilled. Expected delivery dates for orders recorded in backlog historically spanned from one to six months.

McCoy Global's backlog as at December 31, 2023, totaled $22.5 million (US$17.0 million), a decrease of $2.2 million or 9% from backlog of $24.7 million (US$18.3 million) as at September 30, 2023. Compared to December 31, 2022, backlog decreased $1.1 million, or 5%, from $23.6 million (US$17.5 million).

(in millions of Canadian dollars)

Book-to-Bill Ratio

The book-to-bill ratio is a measure of the amount of net sales orders received to revenues recognized. The ratio is an indicator of customer demand and sales order processing times. The book-to-bill ratio is not a GAAP measure and therefore the definition and calculation of the ratio will vary among other issuers reporting the book-to-bill ratio. McCoy Global calculates the book-to-bill ratio as net sales orders taken in the reporting period divided by the revenues reported for the same reporting period. Orders received are those orders in a period which have been included in backlog. Orders received are typically booked in $USD. For each reporting period, orders received are converted to $CAD at an average foreign exchange rate for the period. As a result, orders received can fluctuate from one reporting period to another because of foreign exchange volatility. Set out below are orders received, revenue and the book-to-bill ratio:

BUSINESS VISION

McCoy Global Inc. is incorporated and domiciled in Canada and is a leading provider of technologies and equipment designed to support tubular running operations, enhance wellbore integrity, and assist with collecting critical data for the global energy industry. McCoy Global's core products are used predominantly during the well construction phase for both land and offshore wells during both oil and gas exploration and development.

The Corporation is engaged in the following:

• design, production and distribution of capital equipment to support tubular running operations, enhance wellbore integrity and increase safety;
• design, production and distribution of aftermarket products and services such as technical support, consumables and replacement parts that support its capital equipment sales;
• design, production and distribution of data collection technologies used in rugged applications for the global energy industry as well as in construction, marine and aerospace;
• repair, maintenance and calibration of the Corporation's capital equipment install base and similar competitor products; and
• rental of the Corporation's equipment and technologies.

Since mid-2008, the oil & gas extraction complex has experienced an increasingly volatile pricing environment and growing public and investor pressure to reduce its impact on the environment and improve safety. In turn, producers have been acutely focused on managing their costs and adapting their business strategy to demonstrate compliance with broader sustainability efforts.

McCoy has a reputation of innovation within tubular running services (TRS) operations globally. The Corporation has extensive experience launching new products into the markets it serves, offering the highest quality, technological advancements, and safety standards available, and has done so for more than three decades.

McCoy believes the TRS space is primed for transformation employing automation and advanced software solutions. Tools and processes used in TRS today are mechanical, highly repetitive, require significant labour inputs, have a high rate of personnel safety exposure, and maintain minimal well integrity data. Recognizing this opportunity, McCoy has conceptualized a 'Smart' TRS system that will operate autonomously using the Corporation's cloud-based data repository and machine learning to improve effectiveness. Our cloud-based platform and digital infrastructure that was developed in 2019, will enable future digital product offerings and enhancements. This cloud based, real time, remote data transmission infrastructure will support our ability to integrate, digitize, and automate the historically manual processes of tubular make up through our smarTRTM automated casing running system.