USWS - Earnings call transcript Q2 2022

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Operator

Greetings, and welcome to the U.S. Well Services second quarter earnings conference call. [Operator Instructions]. I would now like to introduce your host for today, Vice President of Finance. Thank you.

begin. may You

Unidentified Company Representative

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

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

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

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

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

Kyle O'Neill

understatement. first everyone. strengthening the the Thanks, Since have market. second the with our Services to Fleet a U.S. that To busy earnings of seen and last new exciting rapid we We was Nyx for ProFrac. an say fundamentals the in quarter deployed into service and of truly of build our agreement entered and Well an quarterly frac call, morning, merge XXXX good Clean is

next-generation our very I of the briefly I'm fleets. to companies this the provide market, transaction excited ProFrac, discuss opportunity deliver I fracturing I'd have ProFrac ProFrac the our to confidence market about total transaction industry, for in continue combined these our fleet largest electric outlook and of great our is technology outstanding uniquely frac our workforces with for technology because our Before pursuing like electric to by company our shareholders. believe their both innovating the and the I Together, will will second positioned the state on that fleet the have and in leverage capabilities, customers industry, largest existing results horsepower. incredible

close longer demand XXXX. transaction Years up and of we caught can of expect equipment supply As fourth the no high-quality the effectively industry. frac market is quarter Today, to underinvestment to customers. this The attrition finally of of meet previously noted, U.S. the in E&P sold the out. have

it increasingly making to and supply active Additionally, maintain difficult fleets. are tight labor staff, a disruptions adequately and market chain supply

pressure significant an in of result that pricing our best equipment is best-in-class Clean in like efficiencies, next-generation to Fleets I'd seen fuel dynamic, generally this a As demand savings for cost industry-leading we to environmental point footprint. levels that service is that offer fracturing such strongest robust, continue technologies demand have we the at while believe as the years. for services and out is pumping

fleets. the in of order worked to profitability our negotiate quarter, second service our the to customers our commercial hard terms with of our During to continue the improve team improving agreements

tailwinds continue We the experience commercial a market favorable backdrop. as to strong of result

the to and deteriorating we inflation and the the into certainly likely continuing this benefiting recession, has are crude be is recent persistent may is prices. pullback oil market macroeconomic that in upturn, markets we recap recognize we also consumers. on that environment high entering from point, led While At that it to

outlook, meet environment recession to the the our view should and for the oil Clean evaluate a needs inventory U.S. that we is we manageable that it result that for next-generation undersupply Fleet, to to for first new believe years in risk next At an economic demonstrated with and remains operations the customers. and gas Nyx developing delivery a an and to taking ability and constantly economic build new began focused efficient with U.S. pose our on business several that fleet a structural from We technologies. the Shale natural track levels. will output the record our Services, as evolving of commenced have strong favorable always frac July. service depleted be However, deploy June, of of the Rockies due Well technologies companies we In demand in our

service excited of is fuel emissions clean performance team generation this quality, and levels the highest savings deliver to technology. with Our of latest cost fleet

sequentially, now, in Well Revenues second $X.X million, quarter $X.X all the I'll customers. review and on, in second more to financial expected a And the Clean Josh from was field performance of in solutions us that all quarter loss posted were very to first our I since innovative and want of that team thank we million the $XX I adjusted quarter accomplished. our With dedication, in strongest allowed to EBITDA work detail. XXXX. that over million, the to Fleet is second to being has of up U.S. going to proud our late commitment end, continue XX% deploy is the high-quality and Our and Nyx financial XXXX. hard call am employees whose all for up was constructed of results delivering that, QX. With turn has Services the services for our

Joshua Shapiro

currently with fleets X $XX.X a during fleets Total active of rate utilization XX%, utilized million X.X to and from expect revenue over quarter the $XX.X for and and and everyone. hour active per X quarter. resulting million, a revenue X X% the average fleets. XXXX. quarter sequentially, basis. Thanks, up good active morning, third Kyle, the well increased in averaged Total Services service U.S. of just have We fleets XX% last equipment increased second for was revenue on fully quarter

$XX.X continued new the quarter the Our fully higher SG&A cost fees labor, the and of quarter by quarter-over-quarter Net of an the the quarter sales million, spending which growth the increase for XXXX. spent accrual was $XX inflation $XX.X million, $X.X with consumables the approximately of utilized clean On for fleet was which our primarily deployed the for an that sequential during $XX.X second of XXXX. continue $XX.X in quarter capital reversible for driven of for basis annualized out these million, driven and EBITDA basis, $X.X per compares increased professional count XXXX. loss of relative of EBITDA from the building would adjusted for on million significant XXXX, compensation we fleets. note third-party of Services second stock $X.X million related and as the $X.X noncash the certain a costs. first fleets. Adjusted of million personnel was million of $XX The quarter year second was restricted a is million million expense million other was approximately in $X.X forfeiture compensation Well expenditures capital for up The to to first We quarter. SG&A quarter awards million and million expenditures to primarily XX% fleet over approximately the during build on maintenance SG&A quarter. was increase related basis, stock-based share-based we anticipate $X.X I charges, improvement quarter million by the in XXXX. second and remainder services. cost On a U.S. to active was of $X.X recorded

turn back the of balance cash call to for with sheet. cash restricted to like remarks. company the final $XX Kyle of million XXXX ended that, Turning million $XX of total consisting $XX and the and I'd second to of With quarter availability. of ABL liquidity, million some The

Kyle O'Neill

that facilitating open Thanks, in Josh. role development has resources. to safe responsible natural and important future our our bright Fleet for call believe economic, the up country's industry and the Operator, please is efficient, play our Clean an the of We technology of Q&A.

Operator

Instructions]. [Operator

Our Podhaizer with first question Barclays. from comes Derek

Derek Podhaizer

on first touch side of to talk about overall supply maybe wanted you the just supply the -- Just can the response and market.

been Just obviously, we're from seeing fast and up. pricing demand has moving pricing indicators the and how the that

back love the to subject peers think play. Tier is a be that where DGB IV So builds. insight market, come we've some some whole you're But getting about worried diesels in, heard just Tier a Obviously, XXXX why is a you're cycle you from get from thoughts so field, around the big little coming X be we're what the in your sitting out to we've Tier in investors and your even your you constrained where to We've into we're where just seeing out. equipment as supply I'd electric heard new guys might though supply seeing going response. just different had X out.

some get supply side. like on overall thoughts would the your Just high-level just on to thought

Kyle O'Neill

pretty of now aged. The is a to is what takes the now asking Sure. do customers tight. that I market mean we're industry horsepower, are work fleet the existing incredibly right lot is seeing that us increased

And of pumps, good. these reliability the so as not just they're

a you've to there? the of be for and the to And anything pretty industry quite we're overall to you So need have Josh, swap age able got tight going want the them to out. production. of I investment in in years maintain to on previous given a location think more be the to add market just while, pumps and lack

Joshua Shapiro

Sure. think more I you're this that seeing is I from thing would time I industry one the add discipline mean around. there

be following a lead that companies think of cycle. don't the want are understanding kind service E&P the they to I -- in boom-and-bust that companies and

sense deploying from so it And where the makes commitment only there's a E&P customers. capital and where real

flood I it will that. in a And would massive think given the get of of just -- off not we're ways think order chains, in tightness the cycle a I we So to to market. underway, supply build see supply

Derek Podhaizer

I'd it. to like Good. Got hear it.

get count. Just -- company into as to to maybe peers chain a target the of X. deployments have scaling we've year-end of an e-frac any, a question, the limit fleet their ambitious has some combined some out U.S. What your pretty side. far bottlenecks Obviously, and e-frac to pushing heard the quarter fleet if or supply would Can the any talk e-frac from might make, expectations? slip initial of Second ProFrac about back e-frac XXXX? by of you as

to a get year. the might slip would from things guys hear or goal limiting next to want chain be there? Just the to factor on you what reachable that's if supply still And

Kyle O'Neill

sure. Yes,

the always I constructing think be -- and always kings bottlenecks to that anytime there you're can equipment, new out. there's work

one I to our -- where for we're committed we got the first for are We've build. -- the think out. that plan that have

second out there's the next key the always The will got one some be you've we've components. through. be think the here And new a just something out going couple of Any then all the months. pump time fourth, kinks. the put It's working on I third a of line, got work that and to rolling to you in test

all out. So these field-worthy it's are they pumps that and roll sure just when ready making

that's probably deployment. to on-time think biggest I risk the

pretty goals feel good I So our are. what about

like our why view We I what's worth but lead currently items, don't those That's transformers things XXXX that been trying have beyond long we'll We out announced. to concerns we're think may more forward, to around there. VFDs. and do develop purchased we build but as those. X budgeting, into change plans you have fleets of see we get have some Going

Operator

from next Our Johnson comes question Don Rice. with Crist

Donald Crist

Northeast is alleviated has on Derek wintertime stole issues. of in Can ask mostly and the as truck the some rails question progressing sand are there general? logistics side. Or issues that just they Have the tight? how now? you now? chain -- about can and the talk were been Obviously, But some still trucking that the my about in I supply in those

Kyle O'Neill

Yes.

water. the market there It's particular, we -- that think has some seeing are been tight from time but still to in still for been delays time I sand, is there. relief, and

Operator

At for comments. Kyle to questions further queue. this would time, O'Neill over like are the turn back in I there call closing Mr. no to

Kyle O'Neill

Thanks, everyone, for day. great in. dialing a Have

Operator

conclude today's This does you. Thank teleconference.

great may day. this time, for participation, You thank a and you and at your lines have disconnect your

U.S. Well Services (USWS) 12 Aug 222022 Q2 Earnings call transcript