Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2022 | Jul. 22, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-37988 | |
Entity Registrant Name | NexTier Oilfield Solutions Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-4016639 | |
Entity Address, Address Line One | 3990 Rogerdale Rd. | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77042 | |
City Area Code | 713 | |
Local Phone Number | 325-6000 | |
Title of 12(b) Security | Common Stock, $0.01, par value | |
Trading Symbol | NEX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 244,141,163 | |
Entity Central Index Key | 0001688476 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Filer Category | Large Accelerated Filer |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 158,136 | $ 110,695 |
Trade and other accounts receivable, net | 456,632 | 301,740 |
Inventories, net | 57,229 | 38,094 |
Assets held for sale | 8,727 | 1,555 |
Prepaid and other current assets | 46,029 | 55,625 |
Total current assets | 726,753 | 507,709 |
Operating lease right-of-use assets | 17,369 | 21,767 |
Finance lease right-of-use assets | 45,616 | 41,537 |
Property and equipment (net of accumulated depreciation of $959,202 and $951,170) | 603,343 | 620,865 |
Goodwill | 192,780 | 192,780 |
Intangible assets (net of accumulated amortization of $71,511 and $62,678) | 57,441 | 64,961 |
Other noncurrent assets | 10,904 | 7,962 |
Total assets | 1,654,206 | 1,457,581 |
Current liabilities: | ||
Accounts payable | 260,217 | 190,963 |
Accrued expenses | 281,402 | 213,923 |
Customer contract liabilities | 21,538 | 23,729 |
Current maturities of long-term operating lease liabilities | 5,481 | 7,452 |
Current maturities of long-term finance lease liabilities | 14,593 | 11,906 |
Current maturities of long-term debt | 13,691 | 13,384 |
Other current liabilities | 13,440 | 10,346 |
Total current liabilities | 610,362 | 471,703 |
Long-term operating lease liabilities, less current maturities | 12,456 | 20,446 |
Long-term finance lease liabilities, less current maturities | 23,585 | 26,873 |
Long-term debt, net of unamortized deferred financing costs and unamortized debt discount, less current maturities | 354,503 | 361,501 |
Other noncurrent liabilities | 9,217 | 30,041 |
Total noncurrent liabilities | 399,761 | 438,861 |
Total liabilities | 1,010,123 | 910,564 |
Stockholders' equity | ||
Common stock, par value $0.01 per share (authorized 500,000 shares, issued and outstanding 244,140 and 242,019 shares, respectively) | 2,442 | 2,420 |
Paid-in capital in excess of par value | 1,105,006 | 1,094,020 |
Retained deficit | (463,914) | (541,164) |
Accumulated other comprehensive loss | 549 | (8,259) |
Total stockholders' equity | 644,083 | 547,017 |
Total liabilities and stockholders' equity | $ 1,654,206 | $ 1,457,581 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Property and equipment, accumulated depreciation | $ 959,202 | $ 951,170 |
Intangible assets, accumulated amortization | $ 71,511 | $ 62,678 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 500,000 | 500,000 |
Common stock issued (in shares) | 244,140 | 244,140 |
Common stock outstanding (in shares) | 242,019 | 242,019 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | ||
Income Statement [Abstract] | |||||
Revenue | $ 842,912 | $ 292,145 | $ 1,477,955 | $ 520,547 | |
Operating costs and expenses: | |||||
Cost of services | [1] | 649,866 | 269,260 | 1,174,522 | 487,037 |
Depreciation and amortization: | 58,794 | 40,671 | 113,957 | 86,539 | |
Selling, general and administrative expenses | 35,855 | 20,734 | 71,714 | 36,803 | |
Merger and integration | 23,682 | 178 | 32,914 | 178 | |
Gain on disposal of assets | (866) | (2,017) | (1,689) | (6,609) | |
Total operating costs and expenses | 767,331 | 328,826 | 1,391,418 | 603,948 | |
Operating income (loss) | 75,581 | (36,681) | 86,537 | (83,401) | |
Other income (expense): | |||||
Other income, net | 1,461 | 11,247 | 6,831 | 8,528 | |
Interest expense, net | (7,344) | (5,726) | (14,718) | (9,932) | |
Total other expense | (5,883) | 5,521 | (7,887) | (1,404) | |
Income (loss) before income taxes | 69,698 | (31,160) | 78,650 | (84,805) | |
Income tax expense | (1,240) | (621) | (1,400) | (1,478) | |
Net Income (loss) | 68,458 | (31,781) | 77,250 | (86,283) | |
Other comprehensive income (loss), net of tax: | |||||
Foreign currency translation adjustments | 538 | (435) | 253 | (98) | |
Hedging activities | 1,565 | (515) | 7,177 | 831 | |
Total comprehensive income (loss) | $ 70,561 | $ (32,731) | $ 84,680 | $ (85,550) | |
Net income (loss) per share: | |||||
Basic net loss per share (in dollars per share) | $ 0.28 | $ (0.15) | $ 0.32 | $ (0.40) | |
Diluted net loss per share (in dollars per share) | $ 0.27 | $ (0.15) | $ 0.31 | $ (0.40) | |
Basic weighted-average common shares outstanding (in shares) | 243,969 | 215,443 | 243,621 | 215,278 | |
Diluted weighted-average common shares outstanding (in shares) | 250,775 | 215,443 | 249,462 | 215,278 | |
[1]Cost of services during the three and six months ended June 30, 2022 excludes depreciation of $54.3 million and $105.2 million, respectively. Cost of services during the three and six months ended June 30, 2021 excludes depreciation of $36.3 million and $77.6 million, respectively. |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations and Comprehensive Loss (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Statement [Abstract] | ||||
Depreciation | $ 54.3 | $ 36.3 | $ 105.2 | $ 77.6 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock | Paid-in capital in excess of par value | Retained deficit | Accumulated other comprehensive income (loss) |
Beginning balance at Dec. 31, 2020 | $ 557,288 | $ 2,144 | $ 989,995 | $ (421,741) | $ (13,110) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 5,203 | 10 | 5,193 | ||
Shares repurchased and retired related to stock-based compensation | (1,010) | (1) | (1,009) | ||
Other comprehensive income (loss) | 2,349 | 2,349 | |||
Net income | (54,502) | (54,502) | |||
Ending balance at Mar. 31, 2021 | 509,328 | 2,153 | 994,179 | (476,243) | (10,761) |
Beginning balance at Dec. 31, 2020 | 557,288 | 2,144 | 989,995 | (421,741) | (13,110) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | (86,283) | ||||
Ending balance at Jun. 30, 2021 | 481,733 | 2,157 | 998,628 | (508,024) | (11,028) |
Beginning balance at Mar. 31, 2021 | 509,328 | 2,153 | 994,179 | (476,243) | (10,761) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 4,889 | 5 | 4,884 | ||
Shares repurchased and retired related to stock-based compensation | (436) | (1) | (435) | ||
Other comprehensive income (loss) | (267) | (267) | |||
Net income | (31,781) | (31,781) | |||
Ending balance at Jun. 30, 2021 | 481,733 | 2,157 | 998,628 | (508,024) | (11,028) |
Beginning balance at Dec. 31, 2021 | 547,017 | 2,420 | 1,094,020 | (541,164) | (8,259) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 7,815 | 19 | 7,796 | ||
Shares repurchased and retired related to stock-based compensation | (3,953) | (3,953) | |||
Other comprehensive income (loss) | 6,014 | 6,014 | |||
Net income | 8,792 | 8,792 | |||
Ending balance at Mar. 31, 2022 | 565,685 | 2,439 | 1,097,863 | (532,372) | (2,245) |
Beginning balance at Dec. 31, 2021 | 547,017 | 2,420 | 1,094,020 | (541,164) | (8,259) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 77,250 | ||||
Ending balance at Jun. 30, 2022 | 644,083 | 2,442 | 1,105,006 | (463,914) | 549 |
Beginning balance at Mar. 31, 2022 | 565,685 | 2,439 | 1,097,863 | (532,372) | (2,245) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 7,547 | 7 | 7,540 | ||
Shares repurchased and retired related to stock-based compensation | (401) | (4) | (397) | ||
Other comprehensive income (loss) | 2,794 | 2,794 | |||
Net income | 68,458 | 68,458 | |||
Ending balance at Jun. 30, 2022 | $ 644,083 | $ 2,442 | $ 1,105,006 | $ (463,914) | $ 549 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 77,250 | $ (86,283) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities | ||
Depreciation and amortization | 113,957 | 86,539 |
Amortization of deferred financing fees | 1,076 | 1,015 |
Gain on disposal of assets | (1,689) | (6,609) |
Unrealized gain on derivative recognized in other comprehensive loss | 0 | 831 |
(Gain) loss on financial instrument and derivatives, net | (6,302) | 2,927 |
Stock-based compensation | 16,995 | 10,092 |
Gain on insurance proceeds recognized in other income | 0 | (9,686) |
Changes in operating assets and liabilities: | ||
Increase in trade and other accounts receivable, net | (154,898) | (35,155) |
Increase in inventories | (19,780) | (3,114) |
Decrease (increase) in prepaid and other current assets | 18,559 | (6,593) |
Decrease in other assets | 7,113 | 11,419 |
Increase in accounts payable | 51,940 | 32,494 |
Increase in accrued expenses | 67,498 | 4,834 |
Increase (decrease) in customer contract liabilities | (2,192) | 2,280 |
Decrease in other liabilities | (23,027) | (13,590) |
Net cash provided by (used in) operating activities | 146,500 | (8,599) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (81,290) | (57,540) |
Advances of deposit on equipment | (3,416) | (4,232) |
Implementation of software | (1,991) | (1,814) |
Proceeds from disposal of assets | 9,223 | 18,376 |
Acquisition of business | 482 | (2,501) |
Proceeds from settlement of WSS Notes and make-whole derivative | 0 | 34,350 |
Proceeds from insurance recoveries | 20 | 0 |
Net cash used in investing activities | (76,972) | (13,361) |
Cash flows from financing activities: | ||
Payments on the term loan facility and equipment loan | (7,259) | (1,750) |
Payments on finance leases | (6,621) | (300) |
Payment of debt issuance costs | (110) | 0 |
Payments for financing liabilities | (3,996) | 0 |
Shares repurchased and retired related to stock-based compensation | (4,354) | (1,446) |
Net cash used in financing activities | (22,340) | (3,496) |
Non-cash effect of foreign translation adjustments | 253 | (98) |
Net increase (decrease) in cash, cash equivalents | 47,441 | (25,554) |
Cash and cash equivalents, beginning | 110,695 | 275,990 |
Cash and cash equivalents, ending | 158,136 | 250,436 |
Supplemental disclosure of cash flow information: | ||
Interest expense, net | 13,366 | 10,502 |
Income taxes | 710 | 0 |
Non-cash investing and financing activities: | ||
Change in accrued capital expenditures | (17,318) | (29,133) |
Non-cash additions to finance right-of-use assets | 6,222 | 0 |
Non-cash additions to finance lease liabilities, including current maturities | (6,020) | 0 |
Non-cash additions to operating right-of-use assets | 2,886 | 3,352 |
Non-cash additions to operating lease liabilities, including current maturities | $ (2,848) | $ (512) |
Basis of Presentation and Natur
Basis of Presentation and Nature of Operations | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Nature of Operations | Basis of Presentation and Nature of Operations The accompanying unaudited condensed consolidated financial statements were prepared using United States Generally Accepted Accounting Principles ("GAAP") and the instructions to Form 10-Q and Regulation S-X. Accordingly, these financial statements do not include all information or notes required by GAAP for annual financial statements and should be read together with the Company's Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 23, 2022. The Company’s accounting policies are in accordance with GAAP. The preparation of financial statements in conformity with these accounting principles requires the Company to make estimates and assumptions that affect (1) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and (2) the reported amounts of revenue and expenses during the reporting period. Ultimate results could differ from the Company’s estimates. Significant items subject to such estimates and assumptions include the useful lives of property and equipment and intangible assets; inventory reserves; acquisition accounting; contingent liabilities; and the valuation of property and equipment, intangible assets, equity issued as consideration in an acquisition, income taxes, stock-based incentive plan awards and derivatives. Management believes the unaudited condensed consolidated financial statements included herein contain all adjustments necessary to present fairly the Company's financial position as of June 30, 2022 and the results of its operations and cash flows for the three and six months ended June 30, 2022 and 2021. Such adjustments are of a normal recurring nature. All intercompany transactions and balances have been eliminated. On August 31, 2021, the Company completed its acquisition (the “Alamo Acquisition”) of Alamo. Merger and integration related costs were recognized separately from the acquisition of assets and assumptions of liabilities in the Alamo Acquisition. Merger costs consist of legal and professional fees and pre-merger notification fees. Integration costs consist of expenses incurred to integrate Alamo’s operations, aligning accounting processes and procedures, integrating its enterprise resource planning system with those of the Company, and any earnout payments. All of these costs are recorded within merger and integration costs on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For additional detailed information regarding the Alamo Acquisition, see Note (3) Alamo Acquisition . The consolidated financial statements prior to August 31, 2021 reflect only the historical results of the Company prior to the completion of the Alamo Acquisition. The financial statements have been prepared using the acquisition method of accounting under existing GAAP, which requires that one of the two companies in the Alamo Acquisition be designated as the acquirer for accounting purposes. The Company and Alamo determined that the Company was the accounting acquirer. Accordingly, consideration given by the Company to complete the Alamo Acquisition was allocated to the underlying tangible and intangible assets and liabilities acquired based on their estimated fair values as of the date of completion of the Alamo Acquisition, with any excess purchase price allocated to goodwill. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies (a) Business Combinations and Asset Acquisitions Business combinations are accounted for using the acquisition method of accounting in accordance with the Accounting Standards Codification (“ASC”) 805, “Business Combinations”, as amended by Accounting Standards Update (“ASU”) 2017-01, “Business Combinations (Topic 805), Clarifying the Definition of a Business.” The purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values. Fair values of the acquired assets and liabilities are measured in accordance with the guidance of ASC 820, using discounted cash flows and other applicable valuation techniques. Every reporting period, the Company reassess the value of any contingent consideration assumed as part of a business acquisition. Any acquisition-related costs incurred by the Company are expensed as incurred. Any excess purchase price over the fair value of the net identifiable assets acquired is recorded as goodwill if the definition of a business is met. Operating results of an acquired business are included in the Company’s results of operations from the date of acquisition. Asset acquisitions are measured based on their cost to the Company, including transaction costs. Asset acquisition costs, or the consideration transferred by the Company, are assumed to be equal to the fair value of the net assets acquired. If the consideration transferred is cash, measurement is based on the amount of cash the Company paid to the seller, as well as transaction costs incurred. Consideration given in the form of non-monetary assets, liabilities incurred or equity interests issued is measured based on either the cost to the Company or the fair value of the assets or net assets acquired, whichever is more clearly evident. The cost of an asset acquisition is allocated to the assets acquired based on their estimated relative fair values. Goodwill is not recognized in an asset acquisition. (b) Revenue Recognition The majority of the Company’s performance obligations are satisfied over time. The Company has determined this best represents the transfer of value from its services to the customer as performance by the Company helps to enhance a customer controlled asset (e.g., unplugging a well, enabling a well to produce oil or natural gas). Measurement of the satisfaction of the performance obligation is measured using the output method, which is typically evidenced by a field ticket. A field ticket includes items such as services performed, consumables used, and man hours incurred to complete the job for the customer. Each field ticket is used to invoice customers. Payment terms for invoices issued are in accordance with a master services agreement with each customer, which typically require payment within 30 to 60 days of the invoice issuance. A portion of the Company’s contracts contain variable consideration. However, this variable consideration is typically unknown at the time of contract inception and is not known until the job is complete, at which time the variability is resolved. Examples of variable consideration include the number of hours that will be incurred and the amount of consumables (such as chemicals and proppants) that will be used to complete a job. Remaining Performance Obligations The Company invoices its customers for the services provided at contractual rates multiplied by the applicable unit of measurement, including volume of consumables used and hours incurred. In accordance with ASC 606, the Company has elected the “Right to Invoice” practical expedient for all contracts, which allows the Company to invoice its customers in an amount that corresponds directly with the value to the customer of the Company’s performance completed to date. With this election, the Company is not required to disclose information about the variable consideration related to its remaining performance obligations. The Company has also elected the practical expedient to expense immediately mobilization costs, as the amortization period would always be less than one year. For those contracts with a term of more than one year, the Company had approximately $23.3 million of unsatisfied performance obligations as of June 30, 2022, which will be recognized as services are performed over the remaining contractual terms. The Company’s obligations for refunds as well as the warranties and related obligations stated in its contracts with its customers are standard to the industry and are related to the correction of any defectiveness in the execution of its performance obligations. Contract Balances In line with industry practice, the Company bills its customers for its services in arrears, typically when the stage or well is completed or at month-end. The majority of the Company’s jobs are completed in less than 30 days. Furthermore, it is currently not standard practice for the Company to execute contracts with prepayment features. As of June 30, 2022, the majority of the Company’s customer contract liability balance is related to the post close service agreement as a result of the Alamo Acquisition. Payment terms after invoicing are typically 30 to 60 days. The Company does not have any significant contract costs to obtain or fulfill contracts with customers; as such, no amounts are recognized on the consolidated balance sheet. Taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and, therefore, are excluded from revenues in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and net cash provided by operating activities in the Condensed Consolidated Statements of Cash Flows. The following is a description of the Company’s core service lines separated by reportable segments from which the Company generates its revenue. For additional detailed information regarding reportable segments, see Note (14) Business Segments . Revenue from the Company’s Completion Services and Well Construction and Intervention (“WC&I”) segments are recognized as follows: Completion Services The Company provides hydraulic fracturing, wireline and pumpdown services pursuant to contractual arrangements, such as term contracts and pricing agreements. In late 2020, the Company began evolving its completion service offerings to develop an integrated natural gas treatment and delivery solution. In 2021, the Company launched its new Power Solutions business, which focuses on gas sourcing, compression, transport, decompression, treatment and related services for its fracturing operations. Revenue from these services are earned as services are rendered, which is generally on a per stage or fixed monthly rate. All revenue is recognized when a contract with a customer exists, the performance obligations under the contract have been satisfied over time, the amount to which the Company has the right to invoice has been determined and collectability of amounts subject to invoice is probable. Contract fulfillment costs, such as mobilization costs and shipping and handling costs, are expensed as incurred and are recorded in cost of services in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). To the extent fulfillment costs are considered separate performance obligations that are billable to the customer, the amounts billed are recorded as revenue in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Once a stage has been completed or products and services have been provided, a field ticket is created that includes charges for the services performed and the chemicals, proppant and compressed natural gas consumed during the course of service. The field ticket may also include charges for the mobilization of the equipment to the location, any additional equipment used on the job and other miscellaneous items. The field ticket represents the amounts to which the Company has the right to invoice and to recognize as revenue. WC&I The Company provides cementing services pursuant to contractual arrangements, such as term contracts, or on a spot market basis. Revenue is recognized upon the completion of each performance obligation, which for cementing services, represents the portion of the well cemented: surface casing, intermediate casing or production liner. The performance obligations are satisfied over time. Jobs for these services are typically short term in nature, with most jobs completed in a day. Once the well has been cemented, a field ticket is created that includes charges for the services performed and the consumables used during the course of service. The field ticket represents the amounts to which the Company has the right to invoice and to recognize as revenue. The Company provides a range of coiled tubing services used for fracturing plug drill-out during completion operations and for well workover and maintenance, primarily on a spot market basis. Jobs for these services are typically short-term in nature, lasting anywhere from a few hours to multiple days. Revenue is recognized upon completion of each day’s work based upon a completed field ticket. The field ticket includes charges for the services performed and the consumables used during the course of service. The field ticket may also include charges for the mobilization and set-up of equipment, the personnel on the job, any additional equipment used on the job, and other miscellaneous consumables. The Company typically charges the customer for the services performed and resources provided on an hourly basis at agreed-upon spot market rates or pursuant to pricing agreements. Disaggregation of Revenue Revenue activities during the three and six months ended June 30, 2022 and 2021 were as follows: Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 (Thousands of Dollars) (Thousands of Dollars) Completion Services WC&I Total Completion Services WC&I Total Geography Northeast $ 110,319 $ 6,376 $ 116,695 $ 199,877 $ 11,886 $ 211,763 Central 159,995 — 159,995 273,091 — 273,091 West Texas 496,916 34,025 530,941 877,063 60,103 937,166 West 30,399 1,462 31,861 49,023 2,297 51,320 International 3,420 — 3,420 4,615 — 4,615 $ 801,049 $ 41,863 $ 842,912 $ 1,403,669 $ 74,286 $ 1,477,955 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 (Thousands of Dollars) (Thousands of Dollars) Completion Services WC&I Total Completion Services WC&I Total Geography Northeast $ 63,200 $ 6,313 $ 69,513 $ 113,308 $ 12,119 $ 125,427 Central 54,649 — 54,649 89,549 — 89,549 West Texas 132,801 16,131 148,932 239,467 28,609 268,076 West 5,395 862 6,257 10,283 1,999 12,282 International 12,794 — 12,794 25,213 — 25,213 $ 268,839 $ 23,306 $ 292,145 $ 477,820 $ 42,727 $ 520,547 (c) Long-Lived Assets with Definite Lives Property and equipment, inclusive of equipment under finance lease, are generally stated at cost. Depreciation on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, which range from 13 months to 40 years. Management determines the estimate of the useful lives and salvage values of property and equipment on expected utilization, technological change and effectiveness of its maintenance programs. Depreciation methods, useful lives and residual values are reviewed annually or as needed based on activities related to specific assets. When components of an item of property and equipment are identifiable and have different useful lives, they are accounted for separately as major components of property and equipment. Gains and losses on disposal of property and equipment are determined by comparing the proceeds from disposal with the carrying amount of property and equipment and are recognized net within operating costs and expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Major classifications of property and equipment and their respective useful lives are as follows: Land Indefinite life Building and leasehold improvements 13 months – 40 years Machinery and equipment 13 months – 25 years Office furniture, fixtures and equipment 3 years – 5 years Leasehold improvements are assigned a useful life equal to the term of the related lease, or its expected period of use. Depreciation methods, useful lives and residual values are reviewed annually. Amortization on definite-lived intangible assets is calculated using the straight-line method over the estimated useful lives of the assets, which range from 2 to 15 years. The majority of the Company's definite lived intangible assets include customer contracts and technology. Property and equipment and definite-lived intangible assets (“Long-lived Assets”) are evaluated on a quarterly basis to identify events or changes in circumstances, referred to as triggering events that indicate the carrying value of a Long-lived Asset may not be recoverable, or upon the occurrence of a triggering event. An impairment loss is recorded in the period in which it is determined that the carrying amount of a Long-lived Asset is not recoverable. The determination of recoverability is made based upon the estimated undiscounted future net cash flows of assets grouped at the lowest level for which there are identifiable cash flows independent of the cash flows of other groups of assets with such cash flows to be realized over the estimated remaining useful life of the primary asset within the asset group. The Company determined the lowest level of identifiable cash flows that are independent of other asset groups to be primarily at the service line level. The Company's asset groups consist of fracturing services, wireline, cementing and coiled tubing. Estimates of undiscounted future net cash flows of assets groups are projected based on estimates of projected revenue growth, unit count, utilization, pricing, gross profit rates, SG&A rates, working capital fluctuations and capital expenditures. Forecasted cash flows take into account known market conditions as of the assessment date, and management’s anticipated business outlook. A terminal period is used to reflect an estimate of stable, perpetual growth. If the estimated undiscounted future net cash flows for a given asset group is less than the carrying amount of the asset groups, an impairment loss is determined by comparing the estimated fair value with the carrying value of the related asset groups. The impairment loss is then allocated across the asset group's major classifications. The Company did not recognize any impairment charges related to the Company’s long-lived assets for the three and six months ended June 30, 2022 or 2021. (d) Leases In accordance with ASU 2016-02, the Company considers any contract that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration to be a lease. The Company determines whether the contract into which it has entered is a lease at the lease commencement date. Rental arrangements with term lengths of one month or less are expensed as incurred, but not recognized as qualifying leases. For lessees, leases can be classified as finance leases or operating leases, while for lessors, leases can be classified as sales-type leases, direct financing leases or operating leases. As lessee, all leases, with the exception of short-term leases, are capitalized on the balance sheet by recording a lease liability, which represents the Company's obligation to make lease payments arising from the lease and a right-of-use ("ROU") asset, which represents the Company's right to use the underlying asset being leased. For leases in which the Company is the lessee, the Company uses a collateralized incremental borrowing rate to calculate the lease liability, as for most leases, the implicit rate in the lease is unknown. The collateralized incremental borrowing rate is based on a yield curve over various term lengths that approximates the borrowing rate the Company would receive if it collateralized its lease arrangements with all of its assets. For leases in which the Company is the lessor, the Company uses the rate implicit in the lease. For finance leases, the Company amortizes the ROU asset on a straight-line basis over the earlier of the useful life of the ROU asset or the end of the lease term and records this amortization in depreciation and amortization expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For finance leases where the Company has determined it is reasonably certain to exercise a purchase option to acquire the underlying asset, the lessee amortizes the ROU asset to the later of the end of the underlying asset’s useful life or lease term and records this amortization in depreciation and amortization expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The Company adjusts the lease liability to reflect lease payments made during the period and interest incurred on the lease liability using the effective interest method. The incurred interest expense is recorded in interest expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For operating leases, the Company recognizes one single lease cost, comprised of the lease payments and amortization of any associated initial direct costs, within rent expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Variable lease costs not included in the determination of the lease liability at the commencement of a lease are recognized in the period when the specified target that triggers the variable lease payments becomes probable. In accordance with ASC 842, the Company has made the following elections for its lease accounting: • all short-term leases with term lengths of 12 months or less will not be capitalized; the underlying class of assets to which the Company has applied this expedient is primarily its apartment leases; • for non-revenue contracts containing both lease and non-lease components, both components will be combined and accounted for as one lease component and accounted for under ASC 842; and • for revenue contracts containing both lease and non-lease components, both components will be combined and accounted for as one component and accounted for under ASC 606. (e) Derivative Instruments and Hedging Activities The Company utilizes interest rate derivatives to manage interest rate risk associated with its floating-rate borrowings. The Company recognizes all derivative instruments as either assets or liabilities on the consolidated balance sheets at their respective fair values. For derivatives designated in hedging relationships, changes in the fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income (loss) until the hedged item affects earnings. The Company only enters into derivative contracts that it intends to designate as hedges for the variability of cash flows to be received or paid related to a recognized asset or liability (i.e. cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged and how the hedging instrument’s effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the gain or loss on the derivative is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The Company discontinues hedge accounting prospectively, when it determines that the derivative is no longer highly effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the originally forecasted transaction is no longer probable of occurring or if management decides to remove the designation of the cash flow hedge. The net derivative instrument gain or loss related to a discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the originally hedged transaction affects earnings, unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period. When it is probable that the originally forecasted transaction will not occur by the end of the originally specified time period, the Company recognizes immediately, in earnings, any gains and losses related to the hedging relationship that were recognized in accumulated other comprehensive income (loss). In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the consolidated balance sheets and recognizes any subsequent changes in the derivative’s fair value in earnings. In addition, we evaluate the terms of our operating agreements and other contracts, if any, to determine whether they contain embedded components that are required to be bifurcated and accounted for separately as derivative financial instruments. For additional detailed information regarding derivatives, see Note (7) Derivatives . (f) Stock-based compensation The Company recognizes compensation expense for restricted stock awards ("RSAs"), restricted stock units to be settled in common stock (“RSUs”), performance-based RSU awards (“PSUs”), non-qualified stock options (“stock options”), and performance unit awards (“PUs”) based on the fair value of the awards at the date of grant. The fair value of RSAs and RSUs is determined based on the number of shares or RSUs granted and the closing price of the Company’s common stock on the date of grant. The fair value of stock options is determined by applying the Black-Scholes model to the grant-date market value of the underlying common shares of the Company. The fair value of PSUs and PUs with market conditions are determined using a Monte Carlo simulation method. The Company has elected to recognize forfeiture credits for these awards as they are incurred, as this method best reflects actual stock-based compensation expense. Compensation expense from time-based RSAs, RSUs, PSUs, PUs, and stock options is amortized on a straight-line basis over the requisite service period, which is generally the vesting period. The PUs are settled in cash and therefore are recorded as liability-classified awards. The PUs are remeasured at fair value every reporting period and the Company recognizes compensation cost for the changes in fair value pro-rated for the portion of the requisite service period rendered. Tax deductions on the stock-based compensation awards are not realized until the awards are vested or exercised. The Company recognizes deferred tax assets for stock-based compensation awards that will result in future deductions on its income tax returns, based on the amount of tax deduction for stock-based compensation recognized at the statutory tax rate in the jurisdiction in which the Company will receive a tax deduction. If the tax deduction for a stock-based award is greater than the cumulative GAAP compensation expense for that award upon realization of a tax deduction, an excess tax benefit will be recognized and recorded as a favorable impact on the effective tax rate. If the tax deduction for an award is less than the cumulative GAAP compensation expense for that award upon realization of the tax deduction, a tax shortfall will be recognized and recorded as an unfavorable impact on the effective tax rate. Any excess tax benefits or shortfalls will be recorded as discrete, adjustments in the period in which they occur. The cash flows resulting from any excess tax benefit will be classified as financing cash flows in the Condensed Consolidated Statements of Cash Flows. The Company provides its employees with the option to settle income tax obligations arising from the vesting of their restricted or deferred stock-based compensation awards by withholding shares equal to such income tax obligations. Shares acquired from employees in connection with the settlement of the employees’ income tax obligations are accounted for as treasury shares that are subsequently retired. RSAs, RSUs, and PSUs are not considered issued and outstanding for purposes of earnings per share calculations until vested. For additional information, see Note (9) Stock-Based Compensation . |
Alamo Acquisition
Alamo Acquisition | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Alamo Acquisition | Alamo Acquisition On August 31, 2021 (the “Alamo Acquisition Date”), the Company completed the Alamo Acquisition in accordance with the terms of the Purchase Agreement, dated as of August 4, 2021 (the “Purchase Agreement”), by and among the Company, NexTier Completion Solutions Inc., Alamo Frac Holdings, LLC, Alamo and the “owner group” identified therein. The Company acquired 100% of Alamo. The Alamo Acquisition was completed for cash consideration of $100.0 million, equity consideration of 26 million shares of the Company’s common stock valued at $82.3 million, post-closing services valued at $30.0 million, an estimated $15.9 million of contingent consideration, $7.4 million of non-contingent consideration, and a net working capital settlement of $0.5 million that was finalized in the fourth quarter of 2021 and was paid to the Company in the first quarter of 2022. The contingent consideration includes a Tier II upgrade payment and earnout payments, which are contingent upon the achievement of certain performance targets, as described in the Purchase Agreement. The Company accounted for the Alamo Acquisition using the acquisition method of accounting. The aggregate purchase price noted above was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of the acquisition. The measurements of some assets acquired and liabilities assumed, such as intangible assets and the earnout were based on inputs that are not observable in the market and thus represent Level 3 inputs. The fair value of acquired property and equipment were based on both available market data and a cost approach. The following table summarizes the fair value of the consideration transferred in the Alamo Acquisition and the allocation of the purchase price to the fair values of the assets acquired and liabilities assumed at the Alamo Acquisition Date: Total Purchase Consideration (Thousands of Dollars) Preliminary Purchase Price Allocation Adjustments Final Purchase Price Allocation Cash consideration (1) $ 100,000 $ — $ 100,000 Equity consideration 82,323 — 82,323 Post close services 30,000 — 30,000 Contingent consideration 15,944 — 15,944 Non contingent consideration 7,370 — 7,370 Net working capital adjustment — (482) (482) Total purchase consideration $ 235,637 $ (482) $ 235,155 Cash $ 7,419 $ — $ 7,419 Trade and accounts receivable 50,619 — 50,619 Inventories 1,726 — 1,726 Prepaid and other current assets 19,654 — 19,654 Assets held for sale 3,282 — 3,282 Property and equipment 114,705 (816) 113,889 Intangible assets 27,113 — 27,113 Finance lease right-of-use assets 35,813 (468) 35,345 Other noncurrent assets 1,676 — 1,676 Total identifiable assets acquired 262,007 (1,284) 260,723 Accounts payable 39,101 — 39,101 Accrued expenses 38,000 — 38,000 Current maturities of long-term finance lease liabilities 10,125 — 10,125 Long-term finance lease liabilities 25,688 (468) 25,220 Non-current liabilities 971 — 971 Total liabilities assumed 113,885 (468) 113,417 Goodwill 87,515 334 87,849 Total purchase consideration $ 235,637 $ (482) $ 235,155 (1) Includes $32.3 million of payments for indebtedness on behalf of Alamo. The following combined pro forma information assumes the Alamo Acquisition occurred on January 1, 2020. The pro forma information presented below is for illustrative purposes only and does not reflect future events that occurred after June 30, 2021 or any operating efficiencies or inefficiencies that resulted from the Alamo Acquisition. The information is not necessarily indicative of results that would have been achieved had the Company controlled Alamo during the period presented. Pro forma adjustments related to the elimination of historical interest expense for debt paid off as part of the Alamo Acquisition were $1.0 million and $2.3 million during the three and six months ended June 30, 2021, respectively. (unaudited, amounts in Thousands of Dollars) Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Revenue $ 374,126 $ 670,023 Net loss (24,160) (71,899) Net loss per share (basic) $ (0.10) $ (0.30) Net loss per share (diluted) $ (0.10) $ (0.30) |
Inventories, net
Inventories, net | 6 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories, net | Inventories, net Inventories, net, consisted of the following as of June 30, 2022 and December 31, 2021: (Thousands of Dollars) June 30, December 31, Sand, including freight $ 20,830 $ 9,674 Chemicals and consumables 6,733 4,204 Materials and supplies 29,666 24,216 Total inventory, net $ 57,229 $ 38,094 Inventories are reported net of obsolescence reserves of $4.4 million and $6.3 million as of June 30, 2022 and December 31, 2021, respectively. The Company recognized $0.3 million and $0.4 million of obsolescence expense during the three and six months ended June 30, 2021, respectively. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt at June 30, 2022 and December 31, 2021 consisted of the following: (Thousands of Dollars) June 30, December 31, 2018 Term Loan Facility $ 336,000 $ 337,750 2021 Equipment Loan 35,940 41,321 Other long-term debt 404 533 Less: Unamortized debt discount and debt issuance costs (4,150) (4,719) Total debt, net of unamortized debt discount and debt issuance costs 368,194 374,885 Less: Current portion (13,691) (13,384) Long-term debt, net of unamortized debt discount and debt issuance costs $ 354,503 $ 361,501 Below is a summary of the Company’s credit facilities outstanding as of June 30, 2022: (Thousands of Dollars) 2021 Equipment Loan 2019 ABL Facility 2018 Term Loan Facility Original facility size $ 46,500 $ 450,000 $ 350,000 Outstanding balance $ 35,940 $ — $ 336,000 Letters of credit issued $ — $ 23,201 $ — Available borrowing base commitment n/a $ 334,311 n/a Interest Rate (1) 5.25 % LIBOR or base rate plus applicable margin LIBOR or base rate plus applicable margin Maturity Date June 1, 2025 October 31, 2024 May 25, 2025 (1) London Interbank Offer Rate (“LIBOR”) is subject to a 1.00% floor. Maturities of the 2018 Term Loan Facility and the 2021 Equipment Loan (each as defined herein) for the next five years are presented below: (Thousands of Dollars) Year-end December 31, 2022 $ 7,478 2023 15,430 2024 15,790 2025 333,646 2026 — $ 372,344 For additional information regarding the terms of our credit facilities, see Note (8) Long-Term Debt to the Company’s audited consolidated financial statements contained in its Annual Report on Form 10-K |
Significant Risks and Uncertain
Significant Risks and Uncertainties | 6 Months Ended |
Jun. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
Significant Risks and Uncertainties | Significant Risks and Uncertainties The Company operates in two reportable segments: Completion Services and WC&I, with significant concentration in the Completion Services segment. During the three months ended June 30, 2022 and 2021, sales to Completion Services customers represented 95% and 92% of the Company's consolidated revenue, respectively. During the six months ended June 30, 2022 and 2021, sales to Completion Services customers represented 95% and 92% of the Company's consolidated revenue. The Company depends on its customers' willingness to make operating and capital expenditures to explore for, develop and produce oil and natural gas onshore in the U.S. This activity is driven by many factors, including current and expected crude oil and natural gas prices. From the end of the fourth quarter of 2019 through mid-August 2020, the U.S. active rig count decreased by 70%, from 805 to 244 rigs before recovering to 351 rigs by the end of 2020, primarily driven by the impact from COVID-19. In 2021, the U.S. active rig count recovery continued, increasing 67% from 351 rigs at the end of 2020 to 586 rigs by the end of 2021. This backdrop drastically impacted the demand for U.S. Completion Services and resulted in increased demand for our services throughout 2021 relative to 2020. By the end of 2021, we started to see signs of improving supply/demand dynamics for U.S. onshore completion services, which resulted in improved pricing and margins relative to earlier in 2021. These improvements accelerated early in 2022 and the Company continued to see disciplined increases in oil supply from the Organization of Petroleum Exporting Countries plus ("OPEC+") and U.S. shale operators through the second quarter of 2022. The Russian invasion of Ukraine increased uncertainty of global supply given the supply of crude oil and natural gas that is exported from Russia. The magnitude, cadence, and resilience of activity and margin improvement is uncertain and dependent on a range of factors, including supply chain disruptions, inflationary pressures, COVID-19 demand resolution, and the ongoing impact of geopolitical tensions on the global economy. Significant customers are those that individually account for 10% or more of the Company's consolidated revenue or total accounts receivable. For the three months ended June 30, 2022, there were no customers that were considered significant. For the six months ended June 30, 2022, revenue from one customer in our completions services segment individually represented 10% or $142.1 million of the Company's consolidated revenue. For the three months ended June 30, 2021, the Company had one significant customer in our completions services segment that represented 11% or $33.0 million of the Company's consolidated revenue. For the six months ended June 30, 2021, the Company had one significant customer in our completions services segment that represented 10% or $52.8 million of the Company's consolidated revenue. For the three months and six ended June 30, 2022, there were no suppliers that individually represented more than 5% of the Company's overall purchases. For the three months ended June 30, 2021, purchases from the Company's top two supplier combined represented approximately 13% of the Company's overall purchases, while for the six months ended June 30, 2021, the Company's top supplier represented approximately 7% of the Company's overall purchases. |
Derivatives
Derivatives | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives The Company uses interest-rate-related derivative instruments to manage its variability of cash flows associated with changes in interest rates on its variable-rate debt. On March 9, 2020, the Company sold its Well Support Services ("WSS") segment to Basic Energy Services, Inc. (“Basic”) for $93.7 million of total proceeds, including cash and $34.4 million of par value Senior Secured Notes, with 10.75% coupon rate, previously issued by Basic. Under the terms of the agreement, (the "WSS Notes") were accompanied by a make-whole guarantee at par value, which guaranteed the payment of $34.4 million to the Company after the WSS Notes were held to the one-year anniversary of March 9, 2021. The cash equivalent make-whole was issued under a fund guarantee by Ascribe III Investments LLC ("Ascribe"), a private equity investment firm with approximately $1.0 billion in assets under management. In the event of a Basic restructuring or a credit rating downgrade in conjunction with a change in control prior to the one year anniversary, the make-whole guarantee would accelerate the WSS Notes to par value of $34.4 million. The Company was entitled to semi-annual interest payments on the WSS Notes based on the 10.75% annual coupon throughout the holding period. The Company identified the make-whole guarantee as an embedded derivative and bifurcated the valuation of the WSS Note and the make-whole guarantee. The Company elected the fair value option for the WSS Notes at the inception of the transaction. The fair value of the WSS Notes and the make-whole guarantee were remeasured at fair value at the end of each reporting period. On March 31, 2021, the Company received a $34.4 million cash payment from Ascribe in full settlement of the WSS Notes and the make-whole guarantee. At the time of the cash payment, the WSS Notes and make-whole guarantee had a fair value of $33.6 million, resulting in a realized gain on settlement of $0.8 million. This gain is recorded within other income (expense) on the Consolidated Statements of Operations and Comprehensive Income (Loss). On May 25, 2018, the Company and certain subsidiaries of the Company as guarantors, entered into a term loan facility (the "2018 Term Loan Facility"). The 2018 Term Loan Facility had an initial aggregate principal amount of $350.0 million and proceeds were used to repay the Company's pre-existing 2017 term loan facility. The 2018 Term Loan Facility has a variable interest rate based on LIBOR, subject to a 1.0% floor. In June 2018, the Company executed a new off-market interest rate swap effective through March 31, 2025 to hedge 50% of its expected LIBOR exposure matching the swap to the 1-month LIBOR, 1% floor, of the 2018 Term Loan Facility, and terminated the pre-existing interest rate swaps. The new interest rate swap was designated in a new cash flow hedge relationship. The following tables present the fair value of the Company's derivative instrument on a gross and net basis as of the periods shown below: (Thousands of Dollars) Derivative Derivative Gross Amounts Gross (1) Net Amounts (2) As of June 30, 2022: Other current asset $ 794 $ — $ 794 $ — $ 794 Other noncurrent asset 1,269 — 1,269 — 1,269 As of December 31, 2021: Other current liability (2,787) — (2,787) — (2,787) Other noncurrent liability $ (3,747) $ — $ (3,747) $ — $ (3,747) (1) Agreements are in place that allow for the financial right of offset for derivative assets and derivative liabilities at settlement or in the event of a default under the agreements. (2) There are no amounts subject to an enforceable master netting arrangement that are not netted in these amounts. There are no amounts of related financial collateral received or pledged. The following table presents gains and losses for the Company's interest rate derivative designated as cash flow hedges (in thousands of dollars): Three Months Ended Six Months Ended 2022 2021 2022 2021 Location Amount of gain recognized in total other comprehensive income (loss) on derivative $ 1,565 $ (515) $ 7,177 $ 831 OCI Amount of loss reclassified from accumulated other comprehensive income (loss) into earnings $ (691) $ (683) $ (1,378) $ (1,349) Interest Expense The gain (loss) recognized in other comprehensive income (loss) for the derivative instrument is presented within hedging activities in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). There were no gains or losses recognized in earnings as a result of excluding amounts from the assessment of hedge effectiveness. Based on recorded values as of June 30, 2022, $0.2 million of net gains will be reclassified from accumulated other comprehensive income (loss) into earnings within the next 12 months. See Note (8) Fair Value Measurements and Financial Information for discussion on fair value measurements related to the Company's derivative instruments. |
Fair Value Measurements and Fin
Fair Value Measurements and Financial Information | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Financial Information | Fair Value Measurements and Financial Information The Company discloses the required fair values of financial instruments in its assets and liabilities under the hierarchy guidelines, in accordance with GAAP. As of June 30, 2022, the Company's financial instruments consisted of cash and cash equivalents, accounts receivable, equity security investments, accounts payable, accrued expenses, derivative instruments, long-term debt and lease obligations. As of June 30, 2022 and December 31, 2021, the carrying values of the Company's financial instruments, included in its Condensed Consolidated Balance Sheets, approximated or equaled their fair values. Recurring Fair Value Measurement As of June 30, 2022 and December 31, 2021, the Company had three financial instruments measured at fair value on a recurring basis which are its interest rate derivative (see Note (7) Derivatives above), the equity security investment, and the earnout payments. The equity security investment was composed primarily of common equity shares and warrants in a publicly traded company, in addition to an immaterial balance related to contingent value rights ("CVRs"). As of June 30, 2022, the Company has sold all of its common equity shares and warrants and only maintains an immaterial investment in the CVRs. The equity security investment is presented within other current assets, the interest rate derivative is presented within other current assets and other noncurrent assets, and the earnout payments are presented within other current liabilities in the consolidated balance sheets. The fair market value of the interest rate swap reflected on the consolidated balance sheets as of June 30, 2022 and December 31, 2021 was determined using industry-standard models that consider various assumptions, including current market and contractual rates for the underlying instruments, time value, implied volatilities, nonperformance risk, as well as other relevant economic measures. Substantially all of these inputs are observable in the marketplace through the full term of the instrument and can be supported by observable data. The following tables present the placement in the fair value hierarchy of assets and liabilities that were measured at fair value on a recurring basis at June 30, 2022 and December 31, 2021 (in thousands of dollars): Fair value measurements at reporting date using June 30, 2022 Level 1 Level 2 Level 3 Assets: Equity security investment $ 132 $ 132 $ — $ — Interest rate derivative 2,063 — 2,063 — Liabilities: Earnout Payments $ (41,387) $ — $ (28,750) $ (12,637) Fair value measurements at reporting date using December 31, 2021 Level 1 Level 2 Level 3 Assets: Equity security investment $ 7,743 $ 7,743 $ — $ — Liabilities: Earnout payments (11,795) — — (11,795) Interest rate derivative $ (6,534) $ — $ (6,534) $ — The fair value of the equity security investment is measured at the end of each reporting period. Gains and losses recognized in relation to the change in fair value of the equity security investment are recognized in other income (expense), net in the condensed consolidated statements of operations and comprehensive income (loss). The Company sold the large majority of its investment, with a book value of $10.3 million during the three months ended June 30, 2022 for $12.4 million, which resulted in a realized gain of $2.1 million. The fair value of the earnout payments are measured at the end of each reporting period. Gains and losses recognized in relation to the change in fair value of the earnout payments are recognized in Merger and integration in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). See Note (3) Alamo Acquisition for further discussion. The total increase in fair value of the earnout payment was $23.1 million and $32.0 million during the three and six months ended June 30, 2022, respectively. As of June 30, 2022, $28.7 million of the earnout payments were based on actual results achieved during the performance period ended June 30, 2022 and were therefore considered Level 2 fair value measurements. During the six months ended June 30, 2022, the Company paid $2.5 million related to the performance period ended December 31, 2021. Credit Risk The Company's financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents, the derivative contract and trade receivables. The Company's cash balances on deposit with financial institutions totaled $158.1 million and $110.7 million as of June 30, 2022 and December 31, 2021, respectively, which exceeded Federal Deposit Insurance Corporation insured limits. The Company regularly monitors these institutions' financial condition. The credit risk from the derivative contract derives from the potential failure of the counterparty to perform under the terms of the derivative contract. The Company minimizes counterparty credit risk in the derivative instrument by entering into the transaction with a high-quality counterparty, whose Standard & Poor's credit rating is higher than BBB. The derivative instrument entered into by the Company does not contain credit-risk-related contingent features. The majority of the Company's trade receivables have payment terms of 30 to 60 days. Significant customers are those that individually account for 10% or more of the Company's consolidated revenue or total accounts receivable. As of June 30, 2022, there were no customers that were considered significant. As of December 31, 2021, trade receivables from the Company's one significant customer individually represented 17% of the Company's total trade receivables. The Company mitigates the associated credit risk by performing credit evaluations and monitoring the payment patterns of its customers. The Company has a process in place to collect substantially all receivables within 30 to 60 days of aging. As of June 30, 2022, the Company had $1.7 million in allowance for credit losses. As of December 31, 2021, the Company had $1.9 million in allowance for credit losses. The Company did not recognize any bad debt expense during the three and six months ended June 30, 2022. During the three and six months ended June 30, 2022, the Company recovered $0.2 million of accounts receivable. During the three and six months ended June 30, 2021, the Company recognized $2.4 million and $1.2 million of bad debt expense, net of recoveries. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Effective as of October 31, 2019, the Company (i) amended and restated the Keane Group, Inc. Equity and Incentive Award Plan under the name NexTier Oilfield Solutions Inc. Equity and Incentive Award Plan (“Equity and Incentive Award Plan”), and (ii) assumed and amended and restated the C&J Energy Services, Inc. 2017 Management Incentive Plan under the name NexTier Oilfield Solutions Inc. (Former C&J Energy) Management Incentive Plan (collectively with the Equity and Incentive Award Plan, the “Equity Award Plans”). As of June 30, 2022, the Company has five types of stock-based compensation outstanding under its Equity Award Plans: (i) RSAs issued to independent directors and certain executives and employees, (ii) RSUs issued to executive officers and key management employees, (iii) non-qualified stock options issued to executive officers, (iv) PSUs issued to executive officers and key management employees, (v) and PUs issued to executive officers and key management employees. The following table summarizes stock-based compensation costs for the three and six months ended June 30, 2022 and 2021 (in thousands of dollars): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Liability-classified awards Cash-settled awards $ 972 $ — $ 1,633 $ — Equity-classified awards Restricted stock awards 317 430 628 765 Restricted stock time-based unit awards 5,029 2,953 10,420 6,218 Non-qualified stock options — 2 — 76 Restricted stock performance-based unit awards 2,201 1,504 4,314 3,033 Stock-based compensation cost 8,519 4,889 16,995 10,092 Tax Benefit (1) (1,220) (1,173) (2,559) (2,422) Stock-based compensation cost, net of tax $ 7,299 $ 3,716 $ 14,436 $ 7,670 (1) The Company is in a valuation allowance position and any tax benefit for stock-based compensation will be offset by the change in valuation allowance. Cash-settled awards During the first quarter of 2022, the Company issued 1,009,737 PUs to executive officers under its Equity and Incentive Awards Plan. These PUs will be settled in cash at the end of the performance period, December 31, 2024, and are classified as liability awards, which are remeasured at fair value at each reporting period. The fair value of these awards as of June 30, 2022 was $9.1 million. The Company recognizes compensation cost for the changes in fair value pro-rated for the portion of the requisite service period rendered. During the three months ended June 30, 2022, the Company recognized $1.0 million in compensation costs related to these awards.During the six months ended June 30, 2022, the Company recognized $1.6 million in compensation costs related to these awards. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share Basic income or (loss) per share is based on the weighted average number of common shares outstanding during the period. Diluted income or (loss) per share includes additional common shares that would have been outstanding if potential common shares with a dilutive effect, such as stock awards from the Equity Awards Plans, had been issued. Anti-dilutive securities represent potentially dilutive securities which are excluded from the computation of diluted income or (loss) per share as their impact would be anti-dilutive. A reconciliation of the numerators and denominators used for the basic and diluted net income (loss) per share computations is as follows (in thousands of dollars): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net Income (loss) $ 68,458 $ (31,781) $ 77,250 $ (86,283) Denominator: Basic weighted-average common shares outstanding (1) 243,969 215,443 243,621 215,278 Dilutive effect of restricted stock awards granted to Board of Directors 195 13 180 6 Dilutive effect of time-based restricted stock awards granted under the Equity Plan 5,223 1,163 4,628 1,321 Dilutive effect of performance-based restricted stock awards granted under the Equity Plan 1,388 1,480 1,033 1,351 Diluted weighted-average common shares outstanding (1) 250,775 218,099 249,462 217,956 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies As of June 30, 2022 and December 31, 2021, the Company had $3.4 million and $1.0 million of deposits on equipment, respectively. Outstanding purchase commitments on equipment were $84.5 million and $54.1 million, as of June 30, 2022 and December 31, 2021, respectively. As of June 30, 2022, the Company had a letter of credit of $23.2 million under the 2019 ABL Facility (as defined herein). Aggregate minimum commitments under long-term raw material supply contracts for the next five years as of June 30, 2022 are listed below: (Thousands of Dollars) 2022 $ 24,585 2023 17,660 2024 1,190 2025 — 2026 — $ 43,435 Litigation From time to time, the Company is subject to legal and administrative proceedings, settlements, investigations, claims and actions, as is typical of the industry. These claims include, but are not limited to, contract claims, environmental claims, employment related claims, claims alleging injury or claims related to operational issues and motor vehicle accidents. The Company's assessment of the likely outcome of litigation matters is based on its judgment of a number of factors, including experience with similar matters, past history, precedents, relevant financial information and other evidence and facts specific to the matter. In accordance with GAAP, the Company accrues for contingencies where the occurrence of a material loss is probable and can be reasonably estimated, based on the Company's best estimate of the expected liability and the Company may record an offsetting receivable to the extent such liability is recoverable from insurance. The Company may increase or decrease its legal accruals in the future, on a matter-by-matter basis, to account for developments in such matters. Notwithstanding the uncertainty as to the final outcome and based upon the information currently available to it, the Company does not currently believe these matters in aggregate will have a material adverse effect on its financial position, results of operations or liquidity. Environmental The Company is subject to various federal, state and local environmental laws and regulations that establish standards and requirements for protection of the environment. The Company cannot predict the future impact of such standards and requirements, which are subject to change and can have retroactive effectiveness. The Company continues to monitor the status of these laws and regulations. Currently, the Company has not been fined, cited or notified of any environmental violations that would have a material adverse effect upon its financial position, liquidity or capital resources. However, management does recognize that by the very nature of the Company's business, material costs could be incurred in the near term to maintain compliance. The amount of such future expenditures is not determinable due to several factors, including the unknown magnitude of possible regulation or liabilities, the unknown timing and extent of the corrective actions which may be required, the determination of the Company's liability in proportion to other responsible parties and the extent to which such expenditures are recoverable from insurance or through indemnification. Regulatory Audits The Company is subject to routine audits by taxing authorities. As of December 31, 2020, the Company had recorded estimates of potential assessments for each audit totaling in the aggregate approximately $33.0 million. For one audit, in particular, the Company disagreed with many aspects of the state’s assessment and began to contest the state’s position through administrative procedures. The Company received a final settlement offer from Texas Attorney General Office on September 8, 2021 for $3.7 million, which resulted in an aggregate reduction to the accrual of $24.9 million during 2021, of which $13.3 million was recognized in the three months ended March 31, 2021. This aggregate reduction was recorded in selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss of 2021. As of June 30, 2022, the Company had recorded estimates of potential assessments, the majority of which is related to an estimate of $14.8 million of potential assessment and exposures for all taxing jurisdictions related to the Alamo Acquisition. As of June 30, 2022, the Company also has an offsetting indemnification receivable of $14.8 million from the former owner of Alamo, recorded pursuant to the Purchase Agreement, in prepaids and other current assets in the Condensed Consolidated Balance Sheet. During the second quarter of 2022, the Company obtained additional information that resulted in a reduction of the Company's accrual and offsetting indemnification receivable related to this audit by $2.9 million. Both the estimated liability and indemnification receivable were recorded in the purchase price allocation at the time of the Alamo Acquisition in 2021. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Cerberus Operations and Advisory Company, Cerberus Capital Management, L.P., and Cerberus Technology Solutions LLC, affiliates of the Company's principal equity holder, provide certain consulting services to the Company. The Company paid $0.2 million and $0.1 million during the three months ended June 30, 2022 and 2021 respectively for these services. The Company paid $0.4 million and $0.2 million during the six months ended June 30, 2022 and 2021, respectively, for these services. As part of the Purchase Agreement, the Company agreed to provide certain post-closing services to Alamo Frac Holdings, LLC valued at $30.0 million in the aggregate. During the three months ended June 30, 2022, the Company did not provide any services to Alamo Frac Holdings, LLC as part of the Purchase Agreement. During the six months ended June 30, 2022, the Company provided $2.4 million of services to Alamo Frac Holdings, LLC. The Company has a remaining customer contract liability related to these services of $21.3 million as of June 30, 2022. |
Business Segments
Business Segments | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments In accordance with ASC 280, "Segment Reporting", the Company routinely evaluates whether its separate segments have changed. This determination is made based on the following factors: (1) the Company’s chief operating decision maker (“CODM”) is currently managing each operating segment as a separate business and evaluating the performance of each segment and making resource allocation decisions distinctly and expects to do so for the foreseeable future, and (2) discrete financial information for each operating segment is available. The following is a description of each reportable segment: Completion Services The Company’s Completion Services segment consists of the following businesses and service lines: (1) fracturing services; (2) wireline and pumpdown services; and (3) completion support services, which includes the Company's research and technology department. Well Construction and Intervention Services The Company’s WC&I Services segment consists of the following businesses and service lines: (1) cementing services and (2) coiled tubing services. The following tables present financial information with respect to the Company’s segments. Corporate and Other represents costs not directly associated with a segment, such as interest expense, income taxes and corporate overhead. Corporate assets include cash, deferred financing costs, derivatives and entity-level machinery equipment. (Thousands of Dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Operations by business segment Adjusted gross profit: Completion Services (1) $ 184,730 $ 20,361 $ 291,064 $ 35,775 WC&I (1) 8,316 2,756 12,369 4,432 Total adjusted gross profit $ 193,046 $ 23,117 $ 303,433 $ 40,207 (1) Adjusted gross profit at the segment level is not considered to be a non-GAAP financial measure as it is the Company's segment measure of profitability and is required to be disclosed under GAAP pursuant to ASC 280. Adjusted gross profit is defined as revenue less cost of services, further adjusted to eliminate items in cost of services that management does not consider in assessing ongoing performance. (Thousands of Dollars) Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Completion Services WC&I Total Completion Services WC&I Total Revenue $ 801,049 $ 41,863 $ 842,912 $ 1,403,669 $ 74,286 $ 1,477,955 Cost of Services 616,319 33,547 649,866 1,112,605 61,917 1,174,522 Gross profit excluding depreciation and amortization 184,730 8,316 193,046 291,064 12,369 303,433 Management adjustments associated with cost of services (1) — — — — — — Adjusted gross profit $ 184,730 $ 8,316 $ 193,046 $ 291,064 $ 12,369 $ 303,433 (1) Adjustments relate to market-driven severance, leased facility closures, and restructuring costs incurred as a result of significant declines in crude oil prices resulting from demand destruction from the COVID-19 pandemic and global oversupply. (Thousands of Dollars) Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Completion Services WC&I Total Completion Services WC&I Total Revenue $ 268,839 $ 23,306 $ 292,145 $ 477,820 $ 42,727 $ 520,547 Cost of Services 248,585 20,675 269,260 448,265 38,772 487,037 Gross profit excluding depreciation and amortization 20,254 2,631 22,885 29,555 3,955 33,510 Management adjustments associated with cost of services (1) 107 125 232 6,220 477 6,697 Adjusted gross profit $ 20,361 $ 2,756 $ 23,117 $ 35,775 $ 4,432 $ 40,207 (1) Adjustments relate to market-driven severance, leased facility closures, and restructuring costs incurred as a result of significant declines in crude oil prices resulting from demand destruction from the COVID-19 pandemic and global oversupply. (Thousands of Dollars) June 30, 2022 December 31, 2021 Total assets by segment: Completion Services $ 1,369,679 $ 1,201,265 WC&I 62,535 60,195 Corporate and Other 221,992 196,121 Total assets $ 1,654,206 $ 1,457,581 Goodwill by segment: Completion Services $ 192,780 $ 192,780 WC&I — — Corporate and Other — — Total goodwill $ 192,780 $ 192,780 |
New Accounting Pronouncements
New Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements (a) Recently Adopted Accounting Standards In July 2021, the Financial Accounting Standards Board ("FASB") issued ASU 2021-05 "Leases (Topic 842) Lessors—Certain Leases with Variable Lease Payments" ("ASU 2021-05"). ASU 2021-05 allows a lessor to classify and account for a lease with variable lease payments that doesn't depend on an index or rate as an operating lease if both: a) The lease would’ve been classified as a sales-type lease or a direct-financing lease in accordance with the lease classification guidance in Topic 842; and b) The lessor would’ve otherwise recognized a day-one loss. This standard is effective for fiscal years beginning after December 15, 2021. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In August 2020, the FASB issued ASU 2020-06 “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40)” (“ASU 2020-06”). ASU 2020-06 simplifies the guidance on the issuer's accounting for convertible debt instruments and convertible preferred stock. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In January 2020, the FASB issued ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)”, which clarifies the interaction between the accounting for investments in equity securities, investment in equity method and certain derivatives instruments. This standard is expected to reduce diversity in practice and increase comparability of the accounting for these interactions. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In December 2019, the FASB issued ASU No 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 in GAAP. The Company adopted this standard on January 1, 2021, and there was no impact on the financial statements. (b) Recently Issued Accounting Standards In October 2021, the FASB issued ASU 2021-08 “Business Combinations (Topic 805) Accounting for Contract Assets and Contact Liabilities from Contracts with Customers” ("ASU 2021-08"). ASU 2021-08 requires acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. This standard is effective beginning on December 15, 2022. The Company does not expect ASU 2021-08 to have any impact on its consolidated financial statements. In January 2021, the FASB issued ASU 2021-01 “Reference Rate Reform (Topic 848)” ("ASU 2021-01"). ASU 2021-01 expands on the GAAP guidance on contract modifications and hedge accounting related to the expected market transition from the LIBOR and other interbank offered rates to alternative reference rates. This standard is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848),” which is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the LIBOR and other interbank offered rates to alternative reference rates. This standard is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn July 19, 2022, the Company entered into a definitive agreement to sell the Company’s Coiled Tubing assets to Gladiator Energy LLC for a cash purchase price of $21.6 million. The transaction is subject to customary closing conditions and is expected to close in the third quarter of 2022. As of June 30, 2022, the carrying values of the Company's Coiled Tubing assets are presented within assets held for sale in the consolidated balance sheets. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The accompanying unaudited condensed consolidated financial statements were prepared using United States Generally Accepted Accounting Principles ("GAAP") and the instructions to Form 10-Q and Regulation S-X. |
Use of Estimates | The Company’s accounting policies are in accordance with GAAP. The preparation of financial statements in conformity with these accounting principles requires the Company to make estimates and assumptions that affect (1) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and (2) the reported amounts of revenue and expenses during the reporting period. Ultimate results could differ from the Company’s estimates. Significant items subject to such estimates and assumptions include the useful lives of property and equipment and intangible assets; inventory reserves; acquisition accounting; contingent liabilities; and the valuation of property and equipment, intangible assets, equity issued as consideration in an acquisition, income taxes, stock-based incentive plan awards and derivatives. |
Business Combinations and Asset Acquisitions | Business Combinations and Asset Acquisitions Business combinations are accounted for using the acquisition method of accounting in accordance with the Accounting Standards Codification (“ASC”) 805, “Business Combinations”, as amended by Accounting Standards Update (“ASU”) 2017-01, “Business Combinations (Topic 805), Clarifying the Definition of a Business.” The purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values. Fair values of the acquired assets and liabilities are measured in accordance with the guidance of ASC 820, using discounted cash flows and other applicable valuation techniques. Every reporting period, the Company reassess the value of any contingent consideration assumed as part of a business acquisition. Any acquisition-related costs incurred by the Company are expensed as incurred. Any excess purchase price over the fair value of the net identifiable assets acquired is recorded as goodwill if the definition of a business is met. Operating results of an acquired business are included in the Company’s results of operations from the date of acquisition. Asset acquisitions are measured based on their cost to the Company, including transaction costs. Asset acquisition costs, or the consideration transferred by the Company, are assumed to be equal to the fair value of the net assets acquired. If the consideration transferred is cash, measurement is based on the amount of cash the Company paid to the seller, as well as transaction costs incurred. Consideration given in the form of non-monetary assets, liabilities incurred or equity interests issued is measured based on either the cost to the Company or the fair value of the assets or net assets acquired, whichever is more clearly evident. The cost of an asset acquisition is allocated to the assets acquired based on their estimated relative fair values. Goodwill is not recognized in an asset acquisition. |
Revenue Recognition | Revenue Recognition The majority of the Company’s performance obligations are satisfied over time. The Company has determined this best represents the transfer of value from its services to the customer as performance by the Company helps to enhance a customer controlled asset (e.g., unplugging a well, enabling a well to produce oil or natural gas). Measurement of the satisfaction of the performance obligation is measured using the output method, which is typically evidenced by a field ticket. A field ticket includes items such as services performed, consumables used, and man hours incurred to complete the job for the customer. Each field ticket is used to invoice customers. Payment terms for invoices issued are in accordance with a master services agreement with each customer, which typically require payment within 30 to 60 days of the invoice issuance. A portion of the Company’s contracts contain variable consideration. However, this variable consideration is typically unknown at the time of contract inception and is not known until the job is complete, at which time the variability is resolved. Examples of variable consideration include the number of hours that will be incurred and the amount of consumables (such as chemicals and proppants) that will be used to complete a job. Remaining Performance Obligations The Company invoices its customers for the services provided at contractual rates multiplied by the applicable unit of measurement, including volume of consumables used and hours incurred. In accordance with ASC 606, the Company has elected the “Right to Invoice” practical expedient for all contracts, which allows the Company to invoice its customers in an amount that corresponds directly with the value to the customer of the Company’s performance completed to date. With this election, the Company is not required to disclose information about the variable consideration related to its remaining performance obligations. The Company has also elected the practical expedient to expense immediately mobilization costs, as the amortization period would always be less than one year. For those contracts with a term of more than one year, the Company had approximately $23.3 million of unsatisfied performance obligations as of June 30, 2022, which will be recognized as services are performed over the remaining contractual terms. The Company’s obligations for refunds as well as the warranties and related obligations stated in its contracts with its customers are standard to the industry and are related to the correction of any defectiveness in the execution of its performance obligations. Contract Balances In line with industry practice, the Company bills its customers for its services in arrears, typically when the stage or well is completed or at month-end. The majority of the Company’s jobs are completed in less than 30 days. Furthermore, it is currently not standard practice for the Company to execute contracts with prepayment features. As of June 30, 2022, the majority of the Company’s customer contract liability balance is related to the post close service agreement as a result of the Alamo Acquisition. Payment terms after invoicing are typically 30 to 60 days. The Company does not have any significant contract costs to obtain or fulfill contracts with customers; as such, no amounts are recognized on the consolidated balance sheet. Taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and, therefore, are excluded from revenues in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and net cash provided by operating activities in the Condensed Consolidated Statements of Cash Flows. The following is a description of the Company’s core service lines separated by reportable segments from which the Company generates its revenue. For additional detailed information regarding reportable segments, see Note (14) Business Segments . Revenue from the Company’s Completion Services and Well Construction and Intervention (“WC&I”) segments are recognized as follows: Completion Services The Company provides hydraulic fracturing, wireline and pumpdown services pursuant to contractual arrangements, such as term contracts and pricing agreements. In late 2020, the Company began evolving its completion service offerings to develop an integrated natural gas treatment and delivery solution. In 2021, the Company launched its new Power Solutions business, which focuses on gas sourcing, compression, transport, decompression, treatment and related services for its fracturing operations. Revenue from these services are earned as services are rendered, which is generally on a per stage or fixed monthly rate. All revenue is recognized when a contract with a customer exists, the performance obligations under the contract have been satisfied over time, the amount to which the Company has the right to invoice has been determined and collectability of amounts subject to invoice is probable. Contract fulfillment costs, such as mobilization costs and shipping and handling costs, are expensed as incurred and are recorded in cost of services in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). To the extent fulfillment costs are considered separate performance obligations that are billable to the customer, the amounts billed are recorded as revenue in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Once a stage has been completed or products and services have been provided, a field ticket is created that includes charges for the services performed and the chemicals, proppant and compressed natural gas consumed during the course of service. The field ticket may also include charges for the mobilization of the equipment to the location, any additional equipment used on the job and other miscellaneous items. The field ticket represents the amounts to which the Company has the right to invoice and to recognize as revenue. WC&I The Company provides cementing services pursuant to contractual arrangements, such as term contracts, or on a spot market basis. Revenue is recognized upon the completion of each performance obligation, which for cementing services, represents the portion of the well cemented: surface casing, intermediate casing or production liner. The performance obligations are satisfied over time. Jobs for these services are typically short term in nature, with most jobs completed in a day. Once the well has been cemented, a field ticket is created that includes charges for the services performed and the consumables used during the course of service. The field ticket represents the amounts to which the Company has the right to invoice and to recognize as revenue. The Company provides a range of coiled tubing services used for fracturing plug drill-out during completion operations and for well workover and maintenance, primarily on a spot market basis. Jobs for these services are typically short-term in nature, lasting anywhere from a few hours to multiple days. Revenue is recognized upon completion of each day’s work based upon a completed field ticket. The field ticket includes charges for the services performed and the consumables used during the course of service. The field ticket may also include charges for the mobilization and set-up of equipment, the personnel on the job, any additional equipment used on the job, and other miscellaneous consumables. The Company typically charges the customer for the services performed and resources provided on an hourly basis at agreed-upon spot market rates or pursuant to pricing agreements. |
Long-Lived Assets with Definite Lives | Long-Lived Assets with Definite Lives Property and equipment, inclusive of equipment under finance lease, are generally stated at cost. Depreciation on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, which range from 13 months to 40 years. Management determines the estimate of the useful lives and salvage values of property and equipment on expected utilization, technological change and effectiveness of its maintenance programs. Depreciation methods, useful lives and residual values are reviewed annually or as needed based on activities related to specific assets. When components of an item of property and equipment are identifiable and have different useful lives, they are accounted for separately as major components of property and equipment. Gains and losses on disposal of property and equipment are determined by comparing the proceeds from disposal with the carrying amount of property and equipment and are recognized net within operating costs and expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Major classifications of property and equipment and their respective useful lives are as follows: Land Indefinite life Building and leasehold improvements 13 months – 40 years Machinery and equipment 13 months – 25 years Office furniture, fixtures and equipment 3 years – 5 years Leasehold improvements are assigned a useful life equal to the term of the related lease, or its expected period of use. Depreciation methods, useful lives and residual values are reviewed annually. Amortization on definite-lived intangible assets is calculated using the straight-line method over the estimated useful lives of the assets, which range from 2 to 15 years. The majority of the Company's definite lived intangible assets include customer contracts and technology. Property and equipment and definite-lived intangible assets (“Long-lived Assets”) are evaluated on a quarterly basis to identify events or changes in circumstances, referred to as triggering events that indicate the carrying value of a Long-lived Asset may not be recoverable, or upon the occurrence of a triggering event. An impairment loss is recorded in the period in which it is determined that the carrying amount of a Long-lived Asset is not recoverable. The determination of recoverability is made based upon the estimated undiscounted future net cash flows of assets grouped at the lowest level for which there are identifiable cash flows independent of the cash flows of other groups of assets with such cash flows to be realized over the estimated remaining useful life of the primary asset within the asset group. The Company determined the lowest level of identifiable cash flows that are independent of other asset groups to be primarily at the service line level. The Company's asset groups consist of fracturing services, wireline, cementing and coiled tubing. Estimates of undiscounted future net cash flows of assets groups are projected based on estimates of projected revenue growth, unit count, utilization, pricing, gross profit rates, SG&A rates, working capital fluctuations and capital expenditures. Forecasted cash flows take into account known market conditions as of the assessment date, and management’s anticipated business outlook. A terminal period is used to reflect an estimate of stable, perpetual growth. If the estimated undiscounted future net cash flows for a given asset group is less than the carrying amount of the asset groups, an impairment loss is determined by comparing the estimated fair value with the carrying value of the related asset groups. The impairment loss is then allocated across the asset group's major classifications. |
Leases | Leases In accordance with ASU 2016-02, the Company considers any contract that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration to be a lease. The Company determines whether the contract into which it has entered is a lease at the lease commencement date. Rental arrangements with term lengths of one month or less are expensed as incurred, but not recognized as qualifying leases. For lessees, leases can be classified as finance leases or operating leases, while for lessors, leases can be classified as sales-type leases, direct financing leases or operating leases. As lessee, all leases, with the exception of short-term leases, are capitalized on the balance sheet by recording a lease liability, which represents the Company's obligation to make lease payments arising from the lease and a right-of-use ("ROU") asset, which represents the Company's right to use the underlying asset being leased. For leases in which the Company is the lessee, the Company uses a collateralized incremental borrowing rate to calculate the lease liability, as for most leases, the implicit rate in the lease is unknown. The collateralized incremental borrowing rate is based on a yield curve over various term lengths that approximates the borrowing rate the Company would receive if it collateralized its lease arrangements with all of its assets. For leases in which the Company is the lessor, the Company uses the rate implicit in the lease. For finance leases, the Company amortizes the ROU asset on a straight-line basis over the earlier of the useful life of the ROU asset or the end of the lease term and records this amortization in depreciation and amortization expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For finance leases where the Company has determined it is reasonably certain to exercise a purchase option to acquire the underlying asset, the lessee amortizes the ROU asset to the later of the end of the underlying asset’s useful life or lease term and records this amortization in depreciation and amortization expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The Company adjusts the lease liability to reflect lease payments made during the period and interest incurred on the lease liability using the effective interest method. The incurred interest expense is recorded in interest expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For operating leases, the Company recognizes one single lease cost, comprised of the lease payments and amortization of any associated initial direct costs, within rent expense on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Variable lease costs not included in the determination of the lease liability at the commencement of a lease are recognized in the period when the specified target that triggers the variable lease payments becomes probable. In accordance with ASC 842, the Company has made the following elections for its lease accounting: • all short-term leases with term lengths of 12 months or less will not be capitalized; the underlying class of assets to which the Company has applied this expedient is primarily its apartment leases; • for non-revenue contracts containing both lease and non-lease components, both components will be combined and accounted for as one lease component and accounted for under ASC 842; and • for revenue contracts containing both lease and non-lease components, both components will be combined and accounted for as one component and accounted for under ASC 606. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company utilizes interest rate derivatives to manage interest rate risk associated with its floating-rate borrowings. The Company recognizes all derivative instruments as either assets or liabilities on the consolidated balance sheets at their respective fair values. For derivatives designated in hedging relationships, changes in the fair value are either offset through earnings against the change in fair value of the hedged item attributable to the risk being hedged or recognized in accumulated other comprehensive income (loss) until the hedged item affects earnings. The Company only enters into derivative contracts that it intends to designate as hedges for the variability of cash flows to be received or paid related to a recognized asset or liability (i.e. cash flow hedge). For all hedging relationships, the Company formally documents the hedging relationship and its risk-management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged and how the hedging instrument’s effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the gain or loss on the derivative is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The Company discontinues hedge accounting prospectively, when it determines that the derivative is no longer highly effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the originally forecasted transaction is no longer probable of occurring or if management decides to remove the designation of the cash flow hedge. The net derivative instrument gain or loss related to a discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the originally hedged transaction affects earnings, unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period. When it is probable that the originally forecasted transaction will not occur by the end of the originally specified time period, the Company recognizes immediately, in earnings, any gains and losses related to the hedging relationship that were recognized in accumulated other comprehensive income (loss). In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the consolidated balance sheets and recognizes any subsequent changes in the derivative’s fair value in earnings. In addition, we evaluate the terms of our operating agreements and other contracts, if any, to determine whether they contain embedded components that are required to be bifurcated and accounted for separately as derivative financial instruments. For additional detailed information regarding derivatives, see Note (7) Derivatives . |
Stock-based compensation | Stock-based compensation The Company recognizes compensation expense for restricted stock awards ("RSAs"), restricted stock units to be settled in common stock (“RSUs”), performance-based RSU awards (“PSUs”), non-qualified stock options (“stock options”), and performance unit awards (“PUs”) based on the fair value of the awards at the date of grant. The fair value of RSAs and RSUs is determined based on the number of shares or RSUs granted and the closing price of the Company’s common stock on the date of grant. The fair value of stock options is determined by applying the Black-Scholes model to the grant-date market value of the underlying common shares of the Company. The fair value of PSUs and PUs with market conditions are determined using a Monte Carlo simulation method. The Company has elected to recognize forfeiture credits for these awards as they are incurred, as this method best reflects actual stock-based compensation expense. Compensation expense from time-based RSAs, RSUs, PSUs, PUs, and stock options is amortized on a straight-line basis over the requisite service period, which is generally the vesting period. The PUs are settled in cash and therefore are recorded as liability-classified awards. The PUs are remeasured at fair value every reporting period and the Company recognizes compensation cost for the changes in fair value pro-rated for the portion of the requisite service period rendered. Tax deductions on the stock-based compensation awards are not realized until the awards are vested or exercised. The Company recognizes deferred tax assets for stock-based compensation awards that will result in future deductions on its income tax returns, based on the amount of tax deduction for stock-based compensation recognized at the statutory tax rate in the jurisdiction in which the Company will receive a tax deduction. If the tax deduction for a stock-based award is greater than the cumulative GAAP compensation expense for that award upon realization of a tax deduction, an excess tax benefit will be recognized and recorded as a favorable impact on the effective tax rate. If the tax deduction for an award is less than the cumulative GAAP compensation expense for that award upon realization of the tax deduction, a tax shortfall will be recognized and recorded as an unfavorable impact on the effective tax rate. Any excess tax benefits or shortfalls will be recorded as discrete, adjustments in the period in which they occur. The cash flows resulting from any excess tax benefit will be classified as financing cash flows in the Condensed Consolidated Statements of Cash Flows. The Company provides its employees with the option to settle income tax obligations arising from the vesting of their restricted or deferred stock-based compensation awards by withholding shares equal to such income tax obligations. Shares acquired from employees in connection with the settlement of the employees’ income tax obligations are accounted for as treasury shares that are subsequently retired. RSAs, RSUs, and PSUs are not considered issued and outstanding for purposes of earnings per share calculations until vested. |
New Accounting Pronouncements | New Accounting Pronouncements (a) Recently Adopted Accounting Standards In July 2021, the Financial Accounting Standards Board ("FASB") issued ASU 2021-05 "Leases (Topic 842) Lessors—Certain Leases with Variable Lease Payments" ("ASU 2021-05"). ASU 2021-05 allows a lessor to classify and account for a lease with variable lease payments that doesn't depend on an index or rate as an operating lease if both: a) The lease would’ve been classified as a sales-type lease or a direct-financing lease in accordance with the lease classification guidance in Topic 842; and b) The lessor would’ve otherwise recognized a day-one loss. This standard is effective for fiscal years beginning after December 15, 2021. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In August 2020, the FASB issued ASU 2020-06 “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40)” (“ASU 2020-06”). ASU 2020-06 simplifies the guidance on the issuer's accounting for convertible debt instruments and convertible preferred stock. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In January 2020, the FASB issued ASU 2020-01, “Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)”, which clarifies the interaction between the accounting for investments in equity securities, investment in equity method and certain derivatives instruments. This standard is expected to reduce diversity in practice and increase comparability of the accounting for these interactions. The Company adopted this standard on January 1, 2022, and there was no material impact on the financial statements. In December 2019, the FASB issued ASU No 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 in GAAP. The Company adopted this standard on January 1, 2021, and there was no impact on the financial statements. (b) Recently Issued Accounting Standards In October 2021, the FASB issued ASU 2021-08 “Business Combinations (Topic 805) Accounting for Contract Assets and Contact Liabilities from Contracts with Customers” ("ASU 2021-08"). ASU 2021-08 requires acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. This standard is effective beginning on December 15, 2022. The Company does not expect ASU 2021-08 to have any impact on its consolidated financial statements. In January 2021, the FASB issued ASU 2021-01 “Reference Rate Reform (Topic 848)” ("ASU 2021-01"). ASU 2021-01 expands on the GAAP guidance on contract modifications and hedge accounting related to the expected market transition from the LIBOR and other interbank offered rates to alternative reference rates. This standard is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848),” which is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the LIBOR and other interbank offered rates to alternative reference rates. This standard is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating the impact of this standard on its consolidated financial statements and related disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of disaggregated revenue | Revenue activities during the three and six months ended June 30, 2022 and 2021 were as follows: Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 (Thousands of Dollars) (Thousands of Dollars) Completion Services WC&I Total Completion Services WC&I Total Geography Northeast $ 110,319 $ 6,376 $ 116,695 $ 199,877 $ 11,886 $ 211,763 Central 159,995 — 159,995 273,091 — 273,091 West Texas 496,916 34,025 530,941 877,063 60,103 937,166 West 30,399 1,462 31,861 49,023 2,297 51,320 International 3,420 — 3,420 4,615 — 4,615 $ 801,049 $ 41,863 $ 842,912 $ 1,403,669 $ 74,286 $ 1,477,955 Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 (Thousands of Dollars) (Thousands of Dollars) Completion Services WC&I Total Completion Services WC&I Total Geography Northeast $ 63,200 $ 6,313 $ 69,513 $ 113,308 $ 12,119 $ 125,427 Central 54,649 — 54,649 89,549 — 89,549 West Texas 132,801 16,131 148,932 239,467 28,609 268,076 West 5,395 862 6,257 10,283 1,999 12,282 International 12,794 — 12,794 25,213 — 25,213 $ 268,839 $ 23,306 $ 292,145 $ 477,820 $ 42,727 $ 520,547 |
Schedule of property and equipment | Major classifications of property and equipment and their respective useful lives are as follows: Land Indefinite life Building and leasehold improvements 13 months – 40 years Machinery and equipment 13 months – 25 years Office furniture, fixtures and equipment 3 years – 5 years |
Alamo Acquisition (Tables)
Alamo Acquisition (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of recognized identified assets acquired and liabilities assumed | The following table summarizes the fair value of the consideration transferred in the Alamo Acquisition and the allocation of the purchase price to the fair values of the assets acquired and liabilities assumed at the Alamo Acquisition Date: Total Purchase Consideration (Thousands of Dollars) Preliminary Purchase Price Allocation Adjustments Final Purchase Price Allocation Cash consideration (1) $ 100,000 $ — $ 100,000 Equity consideration 82,323 — 82,323 Post close services 30,000 — 30,000 Contingent consideration 15,944 — 15,944 Non contingent consideration 7,370 — 7,370 Net working capital adjustment — (482) (482) Total purchase consideration $ 235,637 $ (482) $ 235,155 Cash $ 7,419 $ — $ 7,419 Trade and accounts receivable 50,619 — 50,619 Inventories 1,726 — 1,726 Prepaid and other current assets 19,654 — 19,654 Assets held for sale 3,282 — 3,282 Property and equipment 114,705 (816) 113,889 Intangible assets 27,113 — 27,113 Finance lease right-of-use assets 35,813 (468) 35,345 Other noncurrent assets 1,676 — 1,676 Total identifiable assets acquired 262,007 (1,284) 260,723 Accounts payable 39,101 — 39,101 Accrued expenses 38,000 — 38,000 Current maturities of long-term finance lease liabilities 10,125 — 10,125 Long-term finance lease liabilities 25,688 (468) 25,220 Non-current liabilities 971 — 971 Total liabilities assumed 113,885 (468) 113,417 Goodwill 87,515 334 87,849 Total purchase consideration $ 235,637 $ (482) $ 235,155 (1) |
Pro forma information Alamo acquisition | Pro forma adjustments related to the elimination of historical interest expense for debt paid off as part of the Alamo Acquisition were $1.0 million and $2.3 million during the three and six months ended June 30, 2021, respectively. (unaudited, amounts in Thousands of Dollars) Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Revenue $ 374,126 $ 670,023 Net loss (24,160) (71,899) Net loss per share (basic) $ (0.10) $ (0.30) Net loss per share (diluted) $ (0.10) $ (0.30) |
Inventories, net (Tables)
Inventories, net (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories, net, consisted of the following as of June 30, 2022 and December 31, 2021: (Thousands of Dollars) June 30, December 31, Sand, including freight $ 20,830 $ 9,674 Chemicals and consumables 6,733 4,204 Materials and supplies 29,666 24,216 Total inventory, net $ 57,229 $ 38,094 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt at June 30, 2022 and December 31, 2021 consisted of the following: (Thousands of Dollars) June 30, December 31, 2018 Term Loan Facility $ 336,000 $ 337,750 2021 Equipment Loan 35,940 41,321 Other long-term debt 404 533 Less: Unamortized debt discount and debt issuance costs (4,150) (4,719) Total debt, net of unamortized debt discount and debt issuance costs 368,194 374,885 Less: Current portion (13,691) (13,384) Long-term debt, net of unamortized debt discount and debt issuance costs $ 354,503 $ 361,501 |
Schedule of line of credit facilities | Below is a summary of the Company’s credit facilities outstanding as of June 30, 2022: (Thousands of Dollars) 2021 Equipment Loan 2019 ABL Facility 2018 Term Loan Facility Original facility size $ 46,500 $ 450,000 $ 350,000 Outstanding balance $ 35,940 $ — $ 336,000 Letters of credit issued $ — $ 23,201 $ — Available borrowing base commitment n/a $ 334,311 n/a Interest Rate (1) 5.25 % LIBOR or base rate plus applicable margin LIBOR or base rate plus applicable margin Maturity Date June 1, 2025 October 31, 2024 May 25, 2025 (1) London Interbank Offer Rate (“LIBOR”) is subject to a 1.00% floor. |
Schedule of maturities of long-term debt | Maturities of the 2018 Term Loan Facility and the 2021 Equipment Loan (each as defined herein) for the next five years are presented below: (Thousands of Dollars) Year-end December 31, 2022 $ 7,478 2023 15,430 2024 15,790 2025 333,646 2026 — $ 372,344 |
Derivatives (Tables)
Derivatives (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of offsetting assets | The following tables present the fair value of the Company's derivative instrument on a gross and net basis as of the periods shown below: (Thousands of Dollars) Derivative Derivative Gross Amounts Gross (1) Net Amounts (2) As of June 30, 2022: Other current asset $ 794 $ — $ 794 $ — $ 794 Other noncurrent asset 1,269 — 1,269 — 1,269 As of December 31, 2021: Other current liability (2,787) — (2,787) — (2,787) Other noncurrent liability $ (3,747) $ — $ (3,747) $ — $ (3,747) (1) Agreements are in place that allow for the financial right of offset for derivative assets and derivative liabilities at settlement or in the event of a default under the agreements. (2) There are no amounts subject to an enforceable master netting arrangement that are not netted in these amounts. There are no amounts of related financial collateral received or pledged. |
Schedule of offsetting liabilities | The following tables present the fair value of the Company's derivative instrument on a gross and net basis as of the periods shown below: (Thousands of Dollars) Derivative Derivative Gross Amounts Gross (1) Net Amounts (2) As of June 30, 2022: Other current asset $ 794 $ — $ 794 $ — $ 794 Other noncurrent asset 1,269 — 1,269 — 1,269 As of December 31, 2021: Other current liability (2,787) — (2,787) — (2,787) Other noncurrent liability $ (3,747) $ — $ (3,747) $ — $ (3,747) (1) Agreements are in place that allow for the financial right of offset for derivative assets and derivative liabilities at settlement or in the event of a default under the agreements. (2) There are no amounts subject to an enforceable master netting arrangement that are not netted in these amounts. There are no amounts of related financial collateral received or pledged. |
Schedule of cash flow hedges included in AOCI | The following table presents gains and losses for the Company's interest rate derivative designated as cash flow hedges (in thousands of dollars): Three Months Ended Six Months Ended 2022 2021 2022 2021 Location Amount of gain recognized in total other comprehensive income (loss) on derivative $ 1,565 $ (515) $ 7,177 $ 831 OCI Amount of loss reclassified from accumulated other comprehensive income (loss) into earnings $ (691) $ (683) $ (1,378) $ (1,349) Interest Expense |
Fair Value Measurements and F_2
Fair Value Measurements and Financial Information (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of assets and liabilities measured on recurring basis | The following tables present the placement in the fair value hierarchy of assets and liabilities that were measured at fair value on a recurring basis at June 30, 2022 and December 31, 2021 (in thousands of dollars): Fair value measurements at reporting date using June 30, 2022 Level 1 Level 2 Level 3 Assets: Equity security investment $ 132 $ 132 $ — $ — Interest rate derivative 2,063 — 2,063 — Liabilities: Earnout Payments $ (41,387) $ — $ (28,750) $ (12,637) Fair value measurements at reporting date using December 31, 2021 Level 1 Level 2 Level 3 Assets: Equity security investment $ 7,743 $ 7,743 $ — $ — Liabilities: Earnout payments (11,795) — — (11,795) Interest rate derivative $ (6,534) $ — $ (6,534) $ — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of stock based compensation cost | The following table summarizes stock-based compensation costs for the three and six months ended June 30, 2022 and 2021 (in thousands of dollars): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Liability-classified awards Cash-settled awards $ 972 $ — $ 1,633 $ — Equity-classified awards Restricted stock awards 317 430 628 765 Restricted stock time-based unit awards 5,029 2,953 10,420 6,218 Non-qualified stock options — 2 — 76 Restricted stock performance-based unit awards 2,201 1,504 4,314 3,033 Stock-based compensation cost 8,519 4,889 16,995 10,092 Tax Benefit (1) (1,220) (1,173) (2,559) (2,422) Stock-based compensation cost, net of tax $ 7,299 $ 3,716 $ 14,436 $ 7,670 (1) |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share | A reconciliation of the numerators and denominators used for the basic and diluted net income (loss) per share computations is as follows (in thousands of dollars): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Numerator: Net Income (loss) $ 68,458 $ (31,781) $ 77,250 $ (86,283) Denominator: Basic weighted-average common shares outstanding (1) 243,969 215,443 243,621 215,278 Dilutive effect of restricted stock awards granted to Board of Directors 195 13 180 6 Dilutive effect of time-based restricted stock awards granted under the Equity Plan 5,223 1,163 4,628 1,321 Dilutive effect of performance-based restricted stock awards granted under the Equity Plan 1,388 1,480 1,033 1,351 Diluted weighted-average common shares outstanding (1) 250,775 218,099 249,462 217,956 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of aggregate minimum commitments | Aggregate minimum commitments under long-term raw material supply contracts for the next five years as of June 30, 2022 are listed below: (Thousands of Dollars) 2022 $ 24,585 2023 17,660 2024 1,190 2025 — 2026 — $ 43,435 |
Business Segments (Tables)
Business Segments (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information by segment | The following tables present financial information with respect to the Company’s segments. Corporate and Other represents costs not directly associated with a segment, such as interest expense, income taxes and corporate overhead. Corporate assets include cash, deferred financing costs, derivatives and entity-level machinery equipment. (Thousands of Dollars) Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Operations by business segment Adjusted gross profit: Completion Services (1) $ 184,730 $ 20,361 $ 291,064 $ 35,775 WC&I (1) 8,316 2,756 12,369 4,432 Total adjusted gross profit $ 193,046 $ 23,117 $ 303,433 $ 40,207 (1) Adjusted gross profit at the segment level is not considered to be a non-GAAP financial measure as it is the Company's segment measure of profitability and is required to be disclosed under GAAP pursuant to ASC 280. Adjusted gross profit is defined as revenue less cost of services, further adjusted to eliminate items in cost of services that management does not consider in assessing ongoing performance. (Thousands of Dollars) Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Completion Services WC&I Total Completion Services WC&I Total Revenue $ 801,049 $ 41,863 $ 842,912 $ 1,403,669 $ 74,286 $ 1,477,955 Cost of Services 616,319 33,547 649,866 1,112,605 61,917 1,174,522 Gross profit excluding depreciation and amortization 184,730 8,316 193,046 291,064 12,369 303,433 Management adjustments associated with cost of services (1) — — — — — — Adjusted gross profit $ 184,730 $ 8,316 $ 193,046 $ 291,064 $ 12,369 $ 303,433 (1) Adjustments relate to market-driven severance, leased facility closures, and restructuring costs incurred as a result of significant declines in crude oil prices resulting from demand destruction from the COVID-19 pandemic and global oversupply. (Thousands of Dollars) Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Completion Services WC&I Total Completion Services WC&I Total Revenue $ 268,839 $ 23,306 $ 292,145 $ 477,820 $ 42,727 $ 520,547 Cost of Services 248,585 20,675 269,260 448,265 38,772 487,037 Gross profit excluding depreciation and amortization 20,254 2,631 22,885 29,555 3,955 33,510 Management adjustments associated with cost of services (1) 107 125 232 6,220 477 6,697 Adjusted gross profit $ 20,361 $ 2,756 $ 23,117 $ 35,775 $ 4,432 $ 40,207 (1) Adjustments relate to market-driven severance, leased facility closures, and restructuring costs incurred as a result of significant declines in crude oil prices resulting from demand destruction from the COVID-19 pandemic and global oversupply. (Thousands of Dollars) June 30, 2022 December 31, 2021 Total assets by segment: Completion Services $ 1,369,679 $ 1,201,265 WC&I 62,535 60,195 Corporate and Other 221,992 196,121 Total assets $ 1,654,206 $ 1,457,581 Goodwill by segment: Completion Services $ 192,780 $ 192,780 WC&I — — Corporate and Other — — Total goodwill $ 192,780 $ 192,780 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Revenue Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 842,912 | $ 292,145 | $ 1,477,955 | $ 520,547 |
Northeast | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 116,695 | 69,513 | 211,763 | 125,427 |
Central | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 159,995 | 54,649 | 273,091 | 89,549 |
West Texas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 530,941 | 148,932 | 937,166 | 268,076 |
West | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 31,861 | 6,257 | 51,320 | 12,282 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 3,420 | 12,794 | 4,615 | 25,213 |
Completion Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 801,049 | 268,839 | 1,403,669 | 477,820 |
Completion Services | Northeast | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 110,319 | 63,200 | 199,877 | 113,308 |
Completion Services | Central | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 159,995 | 54,649 | 273,091 | 89,549 |
Completion Services | West Texas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 496,916 | 132,801 | 877,063 | 239,467 |
Completion Services | West | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 30,399 | 5,395 | 49,023 | 10,283 |
Completion Services | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 3,420 | 12,794 | 4,615 | 25,213 |
WC&I | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 41,863 | 23,306 | 74,286 | 42,727 |
WC&I | Northeast | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 6,376 | 6,313 | 11,886 | 12,119 |
WC&I | Central | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
WC&I | West Texas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 34,025 | 16,131 | 60,103 | 28,609 |
WC&I | West | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,462 | 862 | 2,297 | 1,999 |
WC&I | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | ||||
Disaggregation of Revenue [Line Items] | ||||
Remaining performance obligation, period | 1 year | 1 year | ||
Remaining performance obligation, amount | $ 23,300 | $ 23,300 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Property and Equipment (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Property, Plant and Equipment [Line Items] | ||||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 | $ 0 |
Minimum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 13 months | |||
Useful lives | 2 years | |||
Maximum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 40 years | |||
Useful lives | 15 years | |||
Building and leasehold improvements | Minimum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 13 months | |||
Building and leasehold improvements | Maximum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 40 years | |||
Machinery and equipment | Minimum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 13 months | |||
Machinery and equipment | Maximum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 25 years | |||
Office furniture, fixtures and equipment | Minimum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 3 years | |||
Office furniture, fixtures and equipment | Maximum | ||||
Property, Plant and Equipment [Line Items] | ||||
Indefinite life | 5 years |
Alamo Acquisition - Narrative (
Alamo Acquisition - Narrative (Details) - Alamo - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | |||
Dec. 31, 2021 | Aug. 31, 2021 | Mar. 31, 2022 | Dec. 31, 2021 | |
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Interest acquired | 100% | |||
Cash consideration | $ 100,000 | $ 100,000 | ||
Equity interest issued (in shares) | 26 | |||
Equity consideration | $ 82,323 | 82,323 | ||
Post close services | 30,000 | 30,000 | ||
Business combination, contingent consideration | 15,900 | |||
Non contingent consideration | 7,370 | 7,370 | ||
Net working capital adjustment | $ (482) | $ 0 | $ (500) | $ (482) |
Alamo Acquisition - Purchase Pr
Alamo Acquisition - Purchase Price Allocation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||||
Dec. 31, 2021 | Aug. 31, 2021 | Mar. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | |
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Goodwill | $ 192,780 | $ 192,780 | $ 192,780 | ||
Alamo | |||||
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Cash consideration | $ 100,000 | 100,000 | |||
Equity consideration | 82,323 | 82,323 | |||
Post close services | 30,000 | 30,000 | |||
Contingent consideration | 15,944 | 15,944 | |||
Non contingent consideration | 7,370 | 7,370 | |||
Net working capital adjustment | (482) | 0 | $ (500) | (482) | |
Total purchase consideration | 235,637 | 235,155 | |||
Cash | 7,419 | 7,419 | 7,419 | ||
Trade and accounts receivable | 50,619 | 50,619 | 50,619 | ||
Inventories | 1,726 | 1,726 | 1,726 | ||
Prepaid and other current assets | 19,654 | 19,654 | 19,654 | ||
Assets held for sale | 3,282 | 3,282 | 3,282 | ||
Property and equipment | 113,889 | 114,705 | 113,889 | ||
Intangible assets | 27,113 | 27,113 | 27,113 | ||
Finance lease right-of-use assets | 35,345 | 35,813 | 35,345 | ||
Other noncurrent assets | 1,676 | 1,676 | 1,676 | ||
Total identifiable assets acquired | 260,723 | 262,007 | 260,723 | ||
Accounts payable | 39,101 | 39,101 | 39,101 | ||
Accrued expenses | 38,000 | 38,000 | 38,000 | ||
Current maturities of long-term finance lease liabilities | 10,125 | 10,125 | 10,125 | ||
Long-term finance lease liabilities | 25,220 | 25,688 | 25,220 | ||
Non-current liabilities | 971 | 971 | 971 | ||
Total liabilities assumed | 113,417 | 113,885 | 113,417 | ||
Goodwill | 87,849 | 87,515 | 87,849 | ||
Total purchase consideration | 235,155 | 235,637 | $ 235,155 | ||
Net working capital adjustment | (482) | ||||
Property and equipment | (816) | ||||
Finance lease right-of-use assets | (468) | ||||
Total identifiable assets acquired | (1,284) | ||||
Long-term finance lease liabilities | (468) | ||||
Total liabilities assumed | (468) | ||||
Goodwill | 334 | ||||
Total purchase consideration | $ (482) | ||||
Alamo | Alamo Debt Repaid In Merger | |||||
Business Combination, Separately Recognized Transactions [Line Items] | |||||
Cash consideration | $ 32,300 |
Alamo Acquisition - Pro Forma (
Alamo Acquisition - Pro Forma (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Interest expense | $ 7,344 | $ 5,726 | $ 14,718 | $ 9,932 |
Alamo | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Interest expense | 1,000 | 2,300 | ||
Revenue | 374,126 | 670,023 | ||
Net loss | $ (24,160) | $ (71,899) | ||
Net income (loss) per share (basic) (in dollars per share) | $ (0.10) | $ (0.30) | ||
Net income (loss) per share (diluted) (in dollars per share) | $ (0.10) | $ (0.30) |
Inventories, net - Schedule of
Inventories, net - Schedule of Inventories, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Inventory [Line Items] | ||
Total inventory, net | $ 57,229 | $ 38,094 |
Sand, including freight | ||
Inventory [Line Items] | ||
Total inventory, net | 20,830 | 9,674 |
Chemicals and consumables | ||
Inventory [Line Items] | ||
Total inventory, net | 6,733 | 4,204 |
Materials and supplies | ||
Inventory [Line Items] | ||
Total inventory, net | $ 29,666 | $ 24,216 |
Inventories, net - Additional I
Inventories, net - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | |
Inventory Disclosure [Abstract] | ||||
Inventory valuation reserves | $ 4.4 | $ 6.3 | ||
Obsolescence expense (reversal) | $ 0.3 | $ 0.4 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt, net of unamortized debt discount and debt issuance costs | $ 368,194 | $ 374,885 |
Less: Current portion | (13,691) | (13,384) |
Long-term debt, net of unamortized debt discount and debt issuance costs | 354,503 | 361,501 |
Notes Payable | ||
Debt Instrument [Line Items] | ||
Other long-term debt | 404 | 533 |
Notes Payable | 2021 Equipment Loan | ||
Debt Instrument [Line Items] | ||
Outstanding balance | 35,940 | 41,321 |
Line of Credit | Revolving Credit Facility | 2018 Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Outstanding balance | 336,000 | 337,750 |
Less: Unamortized debt discount and debt issuance costs | $ (4,150) | $ (4,719) |
Long-Term Debt - Credit Facilit
Long-Term Debt - Credit Facility (Details) - USD ($) | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | May 25, 2018 | |
Notes Payable | 2021 Equipment Loan | ||||
Line of Credit Facility [Line Items] | ||||
Debt instrument, face amount | $ 46,500,000 | |||
Outstanding balance | $ 35,940,000 | $ 41,321,000 | ||
Debt stated interest rate | 5.25% | |||
Line of Credit | Revolving Credit Facility | 2019 ABL Facility | ||||
Line of Credit Facility [Line Items] | ||||
Original facility size | $ 450,000,000 | |||
Letters of credit issued | 23,200,000 | |||
Available borrowing base commitment | 334,311,000 | |||
Line of Credit | Revolving Credit Facility | 2019 ABL Facility | LIBOR | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate floor | 1% | |||
Line of Credit | Revolving Credit Facility | 2018 Term Loan Facility | ||||
Line of Credit Facility [Line Items] | ||||
Original facility size | 350,000,000 | $ 350,000,000 | ||
Outstanding balance | 336,000,000 | $ 337,750,000 | ||
Letters of credit issued | 0 | |||
Line of Credit | Revolving Credit Facility | Asset-based Revolving Credit Agreement 2017 | ||||
Line of Credit Facility [Line Items] | ||||
Letters of credit issued | $ 23,201,000 |
Long-Term Debt - Schedule of Ma
Long-Term Debt - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt, net of unamortized debt discount and debt issuance costs | $ 368,194 | $ 374,885 |
Term Loan | 2018 Term Loan Facility | ||
Debt Instrument [Line Items] | ||
2022 | 7,478 | |
2023 | 15,430 | |
2024 | 15,790 | |
2025 | 333,646 | |
2026 | 0 | |
Total debt, net of unamortized debt discount and debt issuance costs | $ 372,344 |
Significant Risks and Uncerta_2
Significant Risks and Uncertainties (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 7 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 USD ($) segment | Jun. 30, 2021 USD ($) | Dec. 31, 2019 rig | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Aug. 15, 2020 rig | Dec. 31, 2021 rig | Dec. 31, 2020 rig | |
Concentration Risk [Line Items] | ||||||||
Number of reportable segments | segment | 2 | |||||||
Number of rigs in trough | rig | 805 | 244 | 586 | 351 | ||||
Concentration risk percentage, oil rig, increase (decrease), compared to prior period | (70.00%) | 67% | ||||||
Revenue | $ 842,912 | $ 292,145 | $ 1,477,955 | $ 520,547 | ||||
Customer 1 | ||||||||
Concentration Risk [Line Items] | ||||||||
Revenue | $ 33,000 | $ 142,100 | $ 52,800 | |||||
Customer Concentration Risk | Revenue | Customer 1 | ||||||||
Concentration Risk [Line Items] | ||||||||
Concentration risk, percentage | 11% | 10% | 10% | |||||
Supplier Concentration Risk | Purchases | Top Suppliers | ||||||||
Concentration Risk [Line Items] | ||||||||
Concentration risk, percentage | 13% | 7% | ||||||
Completion Services | ||||||||
Concentration Risk [Line Items] | ||||||||
Revenue | $ 801,049 | $ 268,839 | $ 1,403,669 | $ 477,820 | ||||
Completion Services | Customer Concentration Risk | Revenue | ||||||||
Concentration Risk [Line Items] | ||||||||
Concentration risk, percentage | 95% | 92% | 95% | 92% |
Derivatives - Additional Inform
Derivatives - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Mar. 09, 2020 | May 25, 2018 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2018 | |
Derivative [Line Items] | ||||||
Gain on sale of derivatives | $ 6,302,000 | $ (2,927,000) | ||||
Amount of gain (loss) recognized in income on derivative (ineffective portion) | 0 | |||||
Net gain (loss) expected to be reclassified from AOCI into earnings in the next 12 months | 200,000 | |||||
Well Support Services [Member] | Disposal Group, Disposed of by Sale | ||||||
Derivative [Line Items] | ||||||
Cash consideration | $ 93,700,000 | |||||
Loan receivable, face amount | 34,400,000 | |||||
Amount of assets under management of company issuing cash equivalent make-whole | $ 1,000,000,000 | |||||
Maturity term | 1 year | |||||
Loans receivable, rate, stated percent | 10.75% | |||||
Derivative, cash received on hedge | $ 34,400,000 | |||||
Notional amount | 33,600,000 | |||||
Well Support Services [Member] | Other Income | Disposal Group, Disposed of by Sale | ||||||
Derivative [Line Items] | ||||||
Gain on sale of derivatives | $ 800,000 | |||||
LIBOR | ||||||
Derivative [Line Items] | ||||||
Percentage of debt hedged by interest rate derivatives | 50% | |||||
Variable rate floor | 1% | |||||
2018 Term Loan Facility | Term Loan | LIBOR | ||||||
Derivative [Line Items] | ||||||
Floor interest rate | 1% | |||||
Revolving Credit Facility | 2018 Term Loan Facility | Line of Credit | ||||||
Derivative [Line Items] | ||||||
Original facility size | $ 350,000,000 | $ 350,000,000 |
Derivatives - Schedule of Offse
Derivatives - Schedule of Offsetting Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Other current asset | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | $ 794 | |
Gross amounts offset in the balance sheet | 0 | |
Net amounts presented in the balance sheet | 794 | |
Other current asset | Derivative designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | 794 | |
Other current asset | Derivative not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | 0 | |
Other noncurrent asset | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | 1,269 | |
Gross amounts offset in the balance sheet | 0 | |
Net amounts presented in the balance sheet | 1,269 | |
Other noncurrent asset | Derivative designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | 1,269 | |
Other noncurrent asset | Derivative not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets and Liabilities | $ 0 | |
Other current liability | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | $ (2,787) | |
Gross amounts offset in the balance sheet | 0 | |
Net amounts presented in the balance sheet | (2,787) | |
Other current liability | Derivative designated as hedging instruments | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | (2,787) | |
Other current liability | Derivative not designated as hedging instruments | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | 0 | |
Other noncurrent liability | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | (3,747) | |
Gross amounts offset in the balance sheet | 0 | |
Net amounts presented in the balance sheet | (3,747) | |
Other noncurrent liability | Derivative designated as hedging instruments | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | (3,747) | |
Other noncurrent liability | Derivative not designated as hedging instruments | ||
Liabilities: | ||
Gross Amounts of Recognized Assets and Liabilities | $ 0 |
Derivatives - Schedule of Cash
Derivatives - Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) (Details) - Derivative designated as hedging instruments - Interest rate derivative - Cash Flow Hedging - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of gain recognized in total other comprehensive income (loss) on derivative | $ 1,565 | $ (515) | $ 7,177 | $ 831 |
Interest Expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of loss reclassified from accumulated other comprehensive income (loss) into earnings | $ (691) | $ (683) | $ (1,378) | $ (1,349) |
Fair Value Measurements and F_3
Fair Value Measurements and Financial Information - Additional Information (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2022 USD ($) derivativeInstrument | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) derivativeInstrument | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) derivativeInstrument | Aug. 31, 2021 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Number of instruments held | derivativeInstrument | 3 | 3 | 3 | |||
Book value of equity securities | $ 10,300,000 | $ 10,300,000 | ||||
Equity securities | 12,400,000 | 12,400,000 | ||||
Equity securities, gain | 2,100,000 | |||||
Cash and cash equivalents | 158,136,000 | 158,136,000 | $ 110,695,000 | |||
Allowance for doubtful accounts receivable | 1,700,000 | 1,700,000 | 1,900,000 | |||
Allowance for credit loss, recovery | 200,000 | 200,000 | ||||
Bad debt expense net of recoveries | 0 | $ 2,400,000 | 0 | $ 1,200,000 | ||
Earnout Payments | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Business combination, contingent consideration | 41,387,000 | 41,387,000 | 2,500,000 | |||
Alamo | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Business combination, contingent consideration | $ 15,900,000 | |||||
Change in amount of contingent consideration, liability | $ 23,100,000 | $ 32,000,000 | ||||
Minimum | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Receivables, payment terms | 30 days | |||||
Maximum | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Receivables, payment terms | 60 days | |||||
Recurring | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Business combination, contingent consideration | $ 11,795,000 | |||||
Customer Concentration Risk | Largest Customer | Accounts Receivable | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Concentration risk, percentage | 17% |
Fair Value Measurements and F_4
Fair Value Measurements and Financial Information - Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Earnout Payments | ||
Liabilities: | ||
Earnout payments | $ (41,387) | $ (2,500) |
Recurring | ||
Assets: | ||
Equity security investment | 132 | 7,743 |
Liabilities: | ||
Earnout payments | (11,795) | |
Recurring | Level 1 | ||
Assets: | ||
Equity security investment | 132 | 7,743 |
Liabilities: | ||
Earnout payments | 0 | |
Recurring | Level 1 | Earnout Payments | ||
Liabilities: | ||
Earnout payments | 0 | |
Recurring | Level 2 | ||
Assets: | ||
Equity security investment | 0 | 0 |
Liabilities: | ||
Earnout payments | 0 | |
Recurring | Level 2 | Earnout Payments | ||
Liabilities: | ||
Earnout payments | (28,750) | |
Recurring | Level 3 | ||
Assets: | ||
Equity security investment | 0 | 0 |
Liabilities: | ||
Earnout payments | (11,795) | |
Recurring | Level 3 | Earnout Payments | ||
Liabilities: | ||
Earnout payments | (12,637) | |
Recurring | Interest rate derivative | ||
Assets: | ||
Interest rate derivative | 2,063 | |
Liabilities: | ||
Interest rate derivative | (6,534) | |
Recurring | Interest rate derivative | Level 1 | ||
Assets: | ||
Interest rate derivative | 0 | |
Liabilities: | ||
Interest rate derivative | 0 | |
Recurring | Interest rate derivative | Level 2 | ||
Assets: | ||
Interest rate derivative | 2,063 | |
Liabilities: | ||
Interest rate derivative | (6,534) | |
Recurring | Interest rate derivative | Level 3 | ||
Assets: | ||
Interest rate derivative | $ 0 | |
Liabilities: | ||
Interest rate derivative | $ 0 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 USD ($) plan | Mar. 31, 2022 shares | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) plan | Jun. 30, 2021 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of types of equity-based compensation | plan | 5 | 5 | |||
Compensation cost | $ 8,519 | $ 4,889 | $ 16,995 | $ 10,092 | |
Cash-settled awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Grants in period (in shares) | shares | 1,009,737 | ||||
Fair value of grants in period | 9,100 | 9,100 | |||
Compensation cost | $ 972 | $ 0 | $ 1,633 | $ 0 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Equity-Based Compensation Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | $ 8,519 | $ 4,889 | $ 16,995 | $ 10,092 |
Tax benefit | (1,220) | (1,173) | (2,559) | (2,422) |
Stock-based compensation cost, net of tax | 7,299 | 3,716 | 14,436 | 7,670 |
Cash-settled awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | 972 | 0 | 1,633 | 0 |
Restricted stock awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | 317 | 430 | 628 | 765 |
Restricted stock time-based unit awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | 5,029 | 2,953 | 10,420 | 6,218 |
Non-qualified stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | 0 | 2 | 0 | 76 |
Restricted stock performance-based unit awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | $ 2,201 | $ 1,504 | $ 4,314 | $ 3,033 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Numerator: | ||||||
Net income (loss) | $ 68,458 | $ 8,792 | $ (31,781) | $ (54,502) | $ 77,250 | $ (86,283) |
Denominator: | ||||||
Basic weighted-average common shares outstanding (in shares) | 243,969 | 215,443 | 243,621 | 215,278 | ||
Diluted weighted-average common shares outstanding (in shares) | 250,775 | 218,099 | 249,462 | 217,956 | ||
Restricted stock awards | ||||||
Denominator: | ||||||
Dilutive effect of awards granted (in shares) | 195 | 13 | 180 | 6 | ||
Restricted stock units | ||||||
Denominator: | ||||||
Dilutive effect of awards granted (in shares) | 5,223 | 1,163 | 4,628 | 1,321 | ||
Restricted stock performance-based unit awards | ||||||
Denominator: | ||||||
Dilutive effect of awards granted (in shares) | 1,388 | 1,480 | 1,033 | 1,351 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Sep. 08, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Accrual reduction | $ 24.9 | ||||
Loss contingency recognized | $ 13.3 | ||||
Alamo | |||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Tax estimate | $ 14.8 | ||||
Indemnification asset, amount | 14.8 | ||||
Indemnification receivable | 2.9 | ||||
Settled Litigation | |||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Final settlement offer | $ 3.7 | ||||
C&J Energy Services, Inc. | |||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Penalties and interest accrued due to income tax examination | $ 33 | ||||
Revolving Credit Facility | 2019 ABL Facility | Line of Credit | |||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Letters of credit issued | 23.2 | ||||
Capital Addition Purchase Commitments | |||||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||||
Deposits on equipment | 3.4 | 1 | |||
Purchase commitments | $ 84.5 | $ 54.1 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Aggregate Minimum Commitments (Details) - Inventories $ in Thousands | Jun. 30, 2022 USD ($) |
Unrecorded Unconditional Purchase Obligation [Line Items] | |
2022 | $ 24,585 |
2023 | 17,660 |
2024 | 1,190 |
2025 | 0 |
2026 | 0 |
Total | $ 43,435 |
Related Party Transactions (Det
Related Party Transactions (Details) - Affiliated Entity - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Consulting Services | ||||
Related Party Transaction [Line Items] | ||||
Amounts paid to related parties | $ 0.2 | $ 0.1 | $ 0.4 | $ 0.2 |
Alamo | ||||
Related Party Transaction [Line Items] | ||||
Post close services | 30 | |||
Services provided to related party | 2.4 | |||
Remaining customer contract liability | $ 21.3 | $ 21.3 |
Business Segments - Adjusted Gr
Business Segments - Adjusted Gross Profit (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Total adjusted gross profit | $ 193,046 | $ 23,117 | $ 303,433 | $ 40,207 |
Completion Services | ||||
Segment Reporting Information [Line Items] | ||||
Total adjusted gross profit | 184,730 | 20,361 | 291,064 | 35,775 |
WC&I | ||||
Segment Reporting Information [Line Items] | ||||
Total adjusted gross profit | $ 8,316 | $ 2,756 | $ 12,369 | $ 4,432 |
Business Segments - Gross Profi
Business Segments - Gross Profit by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | ||
Segment Reporting Information [Line Items] | |||||
Revenue | $ 842,912 | $ 292,145 | $ 1,477,955 | $ 520,547 | |
Cost of Services | [1] | 649,866 | 269,260 | 1,174,522 | 487,037 |
Gross profit excluding depreciation and amortization | 193,046 | 22,885 | 303,433 | 33,510 | |
Management adjustments associated with cost of services | 0 | 232 | 0 | 6,697 | |
Adjusted gross profit | 193,046 | 23,117 | 303,433 | 40,207 | |
Completion Services | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 801,049 | 268,839 | 1,403,669 | 477,820 | |
Cost of Services | 616,319 | 248,585 | 1,112,605 | 448,265 | |
Gross profit excluding depreciation and amortization | 184,730 | 20,254 | 291,064 | 29,555 | |
Management adjustments associated with cost of services | 0 | 107 | 0 | 6,220 | |
Adjusted gross profit | 184,730 | 20,361 | 291,064 | 35,775 | |
WC&I | |||||
Segment Reporting Information [Line Items] | |||||
Revenue | 41,863 | 23,306 | 74,286 | 42,727 | |
Cost of Services | 33,547 | 20,675 | 61,917 | 38,772 | |
Gross profit excluding depreciation and amortization | 8,316 | 2,631 | 12,369 | 3,955 | |
Management adjustments associated with cost of services | 0 | 125 | 0 | 477 | |
Adjusted gross profit | $ 8,316 | $ 2,756 | $ 12,369 | $ 4,432 | |
[1]Cost of services during the three and six months ended June 30, 2022 excludes depreciation of $54.3 million and $105.2 million, respectively. Cost of services during the three and six months ended June 30, 2021 excludes depreciation of $36.3 million and $77.6 million, respectively. |
Business Segments - Schedule of
Business Segments - Schedule of Assets and Goodwill by Segment (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | $ 1,654,206 | $ 1,457,581 |
Goodwill | 192,780 | 192,780 |
Operating Segments | Completion Services | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | 1,369,679 | 1,201,265 |
Goodwill | 192,780 | 192,780 |
Operating Segments | WC&I | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | 62,535 | 60,195 |
Goodwill | 0 | 0 |
Corporate and Other | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Assets | 221,992 | 196,121 |
Goodwill | $ 0 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Jul. 19, 2022 USD ($) |
Subsequent Event | |
Subsequent Event [Line Items] | |
Proceeds from sale of assets | $ 21.6 |