USWS - Earnings call transcript Q4 2021

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Operator

Greetings and welcome to U.S. Well Services Fourth Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] A reminder, this conference is being recorded. pleasure your my Mr. now is to host, introduce It Josh Shapiro. Thank you.

begin. may You

Josh Shapiro

operator XXXX results. Thank for everyone. We webcast the good appreciate morning, Well full and you, quarter the conference to and Services you review and call fourth year U.S. joining us

Kyle the and Chief Joining Executive us Joel Chief this call on Financial are Officer. morning Broussard, Officer; O'Neill,

XXXX release no XX-K its this be the be of evening, U.S. Yesterday Please of call be the Following full with and the at note for year accurate open March company's prepared reading. any earnings evening. as Form time remarks, also on replay only may uswellservices.com. the reported Q&A. today, of information therefore, earnings. longer fourth on found the The quarter speaks and Services yesterday XX, as can filed call released The will that website Well its or SEC transcript listening XXXX the information time-sensitive company

by this statements management. reflect the views made securities forward-looking United These comments of the U.S. Well laws. of management States meaning may addition, conference contain the statements the during In federal within forward-looking Services call current

uncertainties cause U.S. results, CEO, the or I'd comparable non-GAAP our those turn Broussard. review the to today's measures will in call, to our during to the filings are Joel Also, call to However, contingencies and non-GAAP performance now, company's over management. from Services measures. directly like release. various of understand statements we with and expressed today's SEC Mr. differ certain is GAAP actual And materially made earnings measures the encouraged contingencies. uncertainties financial to Reconciliations and the Well achievements most reference to these included in those by risks, listener could The earnings risks, release

Joel Broussard

the million securing additional our repaid months, X% Well power-generating U.S. year XX interest our everyone. was team year, CapEx of in the quarter; bolster first from and Well growth X% executing QX during our $XX.X next during the so critical QX filled liquidity loan the rate and the Fleet, balance for like of for our raises $XXX.X for designed multiple transition count distractions of reduced remain into interest an $XXX footprint term of hard million with over -- XXXX three throughout and of achieved our to the the electric our for customers. five contracts million sales for the all delivering a generation million; Clean approximately of raise by Services, or operational term in our challenges. operations Josh contracts many year the our extended morning, construction good QX; of and $XX and senior these in new and safe rate asset validating cash for all technology team a won I'm for Rocky with $XXX throughout our capital our four for Vernal, year. XXXX; proud fleets; our four and efficient by executed a off of frac our fleet quality fleet our and team XX loan last EBITDA; Despite by Services $XX.X of technology of dedicated XXXX Utah assets expanded to for facility; initiated Mountains for million million, of IP our the newbuilds; the existing opening electric Nyx on thanking Thanks, phasing start their our XX our new for which far XXXX significant plans. fund I'd U.S. portfolio; to milestone of our conventional three work individual change licenses laser-focused value existing to including sold active and generating Fleet successes revenue and conventional diesel brought the out equipment secured Clean adjusted incredibly fleets

results in to achievements the up beyond. did of results, we the positioned XXXX have show in strongly quarter these succeed the fourth not company and While

the Our some the the headwinds of fourth results the transformation in strategic the faced felt quarter as difficulty for illustrates we undertaking macroeconomic as well industry. by entire

This to our to overhead, impacting allows field result period by and a absorb count corporate as diesel profitability. from fewer our away be our fleet of continue transition impacted the fleets during We level reduced equipment.

new as starting seasonality we compared impacted to with the roll expected this the fully quarter to during fleet fleets overhead fourth of year. QX begin However, to We utilized in see absorption five X.X as in third. out were typical we great our active by

materially operations inability by water truck the required of Our were for all our lack to impacted their drivers both, customers and sand of of the and obtain operations.

total During we due of XX the days fleet a XX.X per constraints. to of quarter, utilized had these or fully days downtime

quarter, respect to fourth green shoots months to began During continue pricing, of XXXX. difficulties the signs Despite the the the earlier pumping noted impact two of first to with pressure for environment through improving we pricing the see services. us

throughout in beginning benefits year. and the rest results moves we realize starting expect However, our to March, the are of of to strategic improve the

to commands relative feel all-electric equipment. fuel from fleet solutions in industry-leading fleets will five cost Services premium and emission we offer market. have gas the believe pressure have premium both Well most greater companies the savings pricing such confident dual And seeing momentum positioned. Today, to this for With and greenhouse and we fuel demand fleets conventional that E&P pumping next-generation reductions. an as We are electric backdrop, We build. continue is this U.S. clean ideally the even such

addition grow of four of in with first new continue the we to our Clean the We QX. Nyx Fleets, fleet deployed which

of means and to by cost diesel for The to field review Our pricing in which is save technologies. relative our additional in in gallon fleets drives quarter the it rise risen diesel from month. it in million can an fourth demand Kyle over to a the quarter This With turn is $X.XX our further value undeniable fleet prices. I'll per has results. proposition $X our financial $X.XX that, alternative over per premium customers demonstrated significant per to gallon the fourth per

Kyle O’Neill

A cost of Joel quarter to fourth during reviewing count results. before of was to in five averaged Thanks, consumables utilization of sand quarter quarter quarter compared water of off good fleets. by color start We XXXX morning, fully Cost of reduction XX% the utilized down fleets fleet the and sand sequentially. sold some quarter sales reduction XXXX XX% the the third was our in during the and to rate $XX.X to year for seasonality. related which of fourth everyone. constraints additional X.X water days for quarter and XX% during adding Northeast sales due with and a I'll totaled on This full Total XX% equates amount and lower active of fourth sand $X.X to the a fleets. XXXX. the XXXX. was in the $XX.X U.S. million fourth related or of quarter revenue which to XX.X five fully the quarter for million million million third fleets utilized total the SG&A XX nonproductive the active driven and period. of in third and time nonproductive fully largely $XX.X shortages time utilization Services reported typical days for utilized the XX% per compares $XX.X million, the revenue down from by is quarter Well

$X.X a accrual related million share-based sequential to for incurred and Excluding million for an versus decrease $X quarter was basis. was primarily quarter of This we compensation, third quarter. expenditures million fourth million was costs. of capital fourth EBITDA personnel of approximately $X.X reduction $X.X SG&A the Adjusted in maintenance loss the the a on XXXX in

for Services long capital U.S. future expenditures Well quarter, million to spent fourth and related $X.X four time growth Fleets newbuild fleets. the lead additional Nyx approximately During the Clean of components

million and incurred growth are We expect spend during to quarter. first the expenditures closer QX when CapEx of in capital million the will for of fleets new between to XXXX. be delivered The on majority these the fleets $XX beginning $X

for $XX.X million. to $XX.X fund raised under company first-lien, our as raises proceeds. on The million fees with financing. million of in last-out to and company million increased February, corporate company's March, XXXX capital will the ended to $X.X of general as $XX.X proceeds these cash equity of forma late associated and the of availability expenses Pro $XX.X the of ABL In closed The balance liquidity total purposes. now with million growth expenditures $XX.X total And our million well consisting liquidity, Turning our a of company sheet. used be facility. capital the

million, quarter, bringing million. As our additional date, senior balance of XXXX, Services to million has down in $XX.X an on we $XXX.X outstanding December secured term To loan. approximately repaid first had U.S. Well XX, the $XXX.X that principal

of resulting XXXX secured a debt rate of savings $XXX As an reflecting year. of two to our a X% the $XXX modest XXXX. in XXXX, nearly of interest now rate quarter XXXX year X.XX% relative $X.X company generated results. a We the significant of full Shifting million cash to million result million, and for of cash through of revenue for increase and in Qs PIK X% for the four interest the reduction, first

as company the an Our labor from compared attributable costs third-party $XX.X as decreased is $XXX.X of our cost procuring increase. in generation cost $XX.X away as to well of from with Increase million power owning XX% transitioned in own to or XXXX million to in an generation and $XXX was XXXX. services sales service in Selling, for power as assets. associated XXXX administrative expense million costs primarily general increase its million

the maintenance million fleet. which our turn $XX.X compensation related capital million of electric company million, to receivable, million closing of Net $XXX.X and totaled million to stock-based remarks. back compared $X.X noncash capital of SG&A fleets. was which for capital for expenditures doubtful expenditures Adjusted for XXXX I'll equates per was collections XXXX. EBITDA attributable to $XX.X $XX.X as utilized Joel million XXXX. year million $XX.X the loss million to to to $XX for was And [ph] The compared were was million growth $XX Excluding Full charges for over $XX.X related to XXXX remaining XXXX with for in newbuild full it year expenditures. fully that, accounts

Joel Broussard

technology all-electric technology. economics, the to we combination first U.S. the in other electric advocates the of for overall fleets has offers pumping ESG personnel believe as is U.S. its for this which fleet. value customers future Since the and bright pressure same the been Well U.S. electric of vocal And to create shareholders. for benefits pumping and No Services company. grow fleet pressure a Kyle. we XXXX, has continue Services why very for fleet introduced technology, that Thanks, HSSE continue and expertise is share deliver to Well

Operator

Please Stifel. with [Operator first Instructions] [ph] question from with Our your comes question. proceed Hopper Alex

Unidentified Analyst

Good Thank my you you. taking morning, And questions. for everyone. thank

Joel Broussard

Alex. Good morning,

Unidentified Analyst

Good morning.

the roll question we you to around when have how your first materialize? basically, you you see on to so, but here, believe frac think if call. the continue said this expect in should should increase do of give So was sharp And I believe little out of touched if full see to start fleets, color complement timing you could QX as to about during I you the a But profitability? I of more just that. we start I a wondering bit that kind

Joel Broussard

to want you Kyle, take that?

Kyle O’Neill

been and in QX mean, mean, I so we've I Yes. definitely in QX far, Absolutely. impacted.

impacted profitability having only running. been four to Our five fleets has by

fleets have we running. So G&A XX had same year had when that the we last we

which what start to will So increase in fleets as than you'll our in definitely XXXX, a profitability. an we up ramp experienced see be better also we these price

fleet goes in First to QX. work

then will And QX QX. end Second QX, next be of in and the fleets early fleet be QX. will two the

exit we'll the year-end, improved profile. year a profitability by So with dramatically

Unidentified Analyst

question if Got I it. a second squeeze And here. in could just

that if You expect curious about that because the and might difficulty just starting to create continue guys of mine. to or kind of also sands against I see inefficiency to at start to see normalize. the continued some you're and commented frac was you site expect during well call to when

Joel Broussard

Kyle?

Kyle O’Neill

beginning really we're I see really that rolling benefits to think fleets to start these QX. the out new with in starting that going of

Unidentified Analyst

of kind so same. the Okay,

awesome. Okay,

Joel Broussard

-- trucking to and sand different and March And in -- we also, customer promises water. due that with

Unidentified Analyst

Got it.

Okay. Thank you the for color.

Operator

now I'd to We've the session. back call comments. Broussard closing to for over reached the question-and-answer turn end of the Joel like

Joel Broussard

for everybody, you, Thank joining.

great weekend. You have a

Operator

call. conference concludes This today's

may at You wonderful this and a day. your time have lines disconnect

U.S. Well Services (USWS) 31 Mar 222021 Q4 Earnings call transcript