ProPetro Holding (PUMP) 11 Nov 182018 Q3 Earnings call transcript

Company Profile

Participants

Sam Sledge	Director, IR
Dale Redman	CEO
Jeff Smith	CFO
Thomas Moll	Stephens
Praveen Narra	Raymond James
George O'Leary	Tudor, Pickering, Holt
James Wicklund	Credit Suisse
John Daniel	Simmons Energy
Chase Mulvehill	Bank of America Merrill Lynch
Blake Gendron	Wolfe Research
Ken Sill	SunTrust
Kurt Hallead	RBC

Call transcript

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Operator

Good day, and welcome to the ProPetro Third Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Sam Sledge, Director of Investor Relations. Please go ahead.

Sam Sledge

Thanks, Alison, and good morning, everyone. on participation your appreciate today's call. We

the the Officer, Dale in Yesterday is we announcement available past, XXXX website September Officer, with Executive Chief afternoon, for earnings our www.propetroservices.com. are on today released quarter Redman; which Smith. ended XXth me Jeff As third at and our Financial Chief

for make summarizes Please note expectations that In addition, a events posted or results. we future call presentation on projections comments statements our the we on forward-looking this morning our today's regarding website Reform covered that Securities Private are any Act. our by Litigation

release Forward- our looking beyond and Reconciliations our to expectations. discussed to and with non-GAAP measures listeners release. our current earnings to Also during can earnings our reference these number call, are most uncertainties risks included the in comparable These of financial of the non-GAAP SEC. results and uncertainties We filings advise statements risks certain are the our subject we to control. cause directly review will which factors from today's many materially measures. of actual are in a risk GAAP differ measures

prepared answer you have. any we after may remarks, questions Finally, our will

I'll So call with turn over that Dale. the

Dale Redman

center we and during of yet for to the more many needs has everyone. by strong period keep company our appreciate our In morning, report and expansion best-in-class good improving capacity, been our in customer's more and months, doubled Sam, quarter Thanks, Building continue front maintaining our performance. financially. aspects you today's joining this XX fleet even of both and past strong on than the important year another the We are ProPetro's to we pleased us best call. operationally arguably has what XX-year history,

period. and we quarter the are teams efforts financial side, on our continue our third well results the our to for outstanding at reflected for the customers excel During

income for provide level a While more I few would per Jeff to bit, highlights $X.XX detail $XXX the or We million. revenue $XX.X generated into a total third posted like million just of XX% by will of net go or diluted share quarter. high in share, to million, higher the level EBITDA quarter for we adjusted X% was record which which the per was $XX.X quarter of from the $X.XX XXXX the grew $XXX.X for second company. a diluted than and We second million

pumping being another. we As be to XXXX year, of a have begin discussed These side the one in the would pressure since needs well past fully are which and one. from we would how business characteristics have responsive over customers year companies performance and expected we to differentiate truly efficiencies day done

So, they culture. ingrained and our in thinking are

performance past model business in DNA. As unsurpassed our industry. I the was A it's third said was in quarter have differentiated of as on the the in our customer display full part centric

pad development drove we transition efficiencies of as mode operational and Continued or manufacturing during a result another saw period. to period the work, increased zipper high

improved to regional sourcing supply of compared as expect more for as We customers efficiencies allows and coming sand locally customers also use XX% sand take increase percentage Regional levels, our of in third quarter. along of our our production Texas this months, side the local source immensely us regional increase delivery With to we Sand the by in second over by adoption logistics. growing well with also fleet to was we the closer a drive as to quarter and coming West customer The even beyond the sand operational sand. chain pump related increased additional saw volumes as online on to rapid well contracted XX% sourced product transition our

and fleet highly all horsepower. to our long-term working our the count agreement. current quarter This our or horsepower, XX last fully was capacity bringing we Early dedicated during of XXX,XXX fleet average active XXX,XXX utilized. fleets a deployed month active is attention fleet fleet under to a Turning XXth with customer which capacity; deployed our frac remain new

service deployed cementing total unit, the one year, continue detailed to over during our I which build at XX an discuss tubing brings and services financial third plan growth Later see turn our during to quarter, quarter unit, opportunities we in it third substantial new-build to for units. we to operations our fleet Jeff? our Jeff Looking and XXXX. now this results. services additional to coiled cementing will size

Jeff Smith

and good Dale, Thanks, everyone. morning,

XXXX, to of compared of cheaper the at Looking ticket to to to million as to quarter, revenue regional the X.X% prior our second $XXX.X third quarter second approximately was adoption from contributing compared in leading the sand quarter, smaller the the $XXX the sequential quarter increased sizes. fell decrease for results million

and to $XXX.X During was of the consistent services of was compared amortization to volumes XXXX. third the services, which related second total due $XXX.X The the the with of revenue pressure third the pumping associated was depression local preceding cheaper million quarter sand decrease million Cost of XXXX, quarter XX.X% for was with quarter primarily for savings. as excluding the quarter. and

margin . million expenses XXXX. deferred and quarter the of totaled segment of revenues, X.X% for was one-time third $X.XX $XX.X the third $XX.X as share compared primarily SG&A inflating XX% share or XX% for compared General approximately revenue as previous the second Net versus per $XX of EBITDA approximately this compared was administrative and prior million approximately XXXX. million expense to of million of to available was in IPO the of stock-based to the with along the pressure for The income increased lower in higher bonus quarter quarter. or usage XXXX decrease pumping quarter third XXXX. XXXX pump to of of The the to per attributable of sand total Adjusted third XX% third and the in $XX.X second compensation XXXX fell diluted was diluted million or EBITDA quarter General percent for to the $X.XX million sand local exclusive XXXX. percentage for us of second quarter $XX.X pressure Adjusted the margin the our quarter as price quarter. of XX% quarter. $XXX.X of driver the X% form volumes increase from quarter for of in services a quarter contracted was million the to administrative second primarily second for pumping As cost an $XX.X improved for quarter expense

Turning and we with to balance the million. $XX.X third of total of on sheet debt hand capital ended spending, and cash $XX.X million quarter the

our capital. our Maintenance CapEx reflected and of from The maintenance throughput incurred During was growth initiatives was the the and million which of $XX.X period on than we primarily level quarter, efficiencies higher during partially fell but quarter. by high operational capital expected. second the driven excess we expenditures spending still

quarter maintenance We the CapEx this throughout initiative on expect maintenance continuing normalize to instituted year. CapEx fourth based in to continue

Finally, $XXX.X the total XXth September liquidity $XXX as million of of million capacity $XX.X including under was and in ABL. million cash

growth turn Dale initiatives possible future the for and announced that table, prioritized comments. his remain all previously cash repayment it fund term shareholder generation on While near from to back proceeds With our return be to I'll toward initiatives. closing will debt

Dale Redman

Jeff. Thanks,

the in while ability we remainder frac to remain this customer expectations exceed our into to deployed. of confident our As fleet we year keeping look and XXXX, fully

years. performance focused well through near the and will continue believe the us providing and set which has apart in environment unsurpassed is our squarely Our differentiated on current us served over model long-term this We to operating cycles. customers

During our across the quarter, we fleets. outstanding again saw third once operating efficiencies

will of collaborative a welcome clearly to and testament and was levels efforts the challenging be typical same the weather achieving the the the in huge this efficiencies seasonality our holiday utilization, to downtime given quarter. and customers While team fourth due of

great we in some that Permian, in in here Permian long-standing development, in the at seen years. is completion on North believe we on clear the the transitions our to to lands region, Permian day. volumes to long-term This come. of opportunities. And the material it one and and lateral world capitalize decades with are the lengths, XXX% in past relationships remarkable of for several the see a it increase the in work the have will frac As the a America operations play premier we industry, active a look most includes remain position focused the of working we is our over broader our resource and pad Through regions

new current value have up different collaborate of how the efforts. in mode. for which involved to returns and look willing all All and is to in perpetual to allow that that change innovation here for all to we consistent manufacturing and of in continued could navigated and it the operating proactively the produced adapted This to us these address We real. will forward successful. customer the our pumpers. said normal more be proud we challenges be field workforce All needs playing show and evolving And to Structural will partner to their manner has leading a quickly are of value proposition be quantifiably our is players that the the perspective stakeholders. base our pressure of mean down proud the are not as blue-chip drive that way and and chain new team to we

questions. We for now Operator? up will open it

Operator

[Operator first of question from Moll come Tommy Stephens. will today Instructions] Our

Thomas Moll

and trends versus per looks here. direction downward got the industry How chalk of record out-performance QX good, opposite EBITDA slow across which trending your So, being your the utilization up Board, do versus maybe the were you've roaster? fleet last just less you and in all full much when made did customer program the were to their to be to cuts customers you standing your impacted made crew base sure overall the

Jeff Smith

touch them. in are there your things of several I'll couple on questions. Tommy,

You've narrative reiterate one. it again. heard I'll day our

matter. customers Your

position collaborative on we that we've the I day-to-day And of fantastic ourselves a listening in in basis really how The ourselves believe with those other people manufacturing heart job are our best of customers. faced challenges built ourselves what that effort that a whatever sync to And they're talk those company of of team we and pride with being on working doing challenges is part in customers. at We the mode. that front with. is aligned about. those this the we pride the our that's how for for And

Thomas Moll

like, is is you it wanted sounds that seeing, down Does operator perspective trends local coming guys sand I cost be but years that innings now sand of the load? the the that is clearly may in quarter-over-quarter, where they to follow-up sand and grown in from under leg there the a to, on as that touch the there late see mean you here? will potentially Dale, quickly? for another do pretty room the continue a there few the terms on old it coming that adoption growing We of quickly, is to running, down cost had were more go the where the regime proppant so are

Dale Redman

But uses it's how I ENP Yes, cost dependent would think, flat in and to on their that with those companies. between say quarter-over-quarter. that going savings what be I company to that's well upon that's different I be particular going think

front. probably that would with or I more answer sand, savings, not that. on to want that's more guess, They'll anything would either load I how drill capital So, assume return wells I that

Operator

James. The Raymond of next question will come from Narra Praveen

Praveen Narra

as what's importantly I when about I expect see to of guess starting XQ are go XQ kind pulling XXXX, of some and is magnitude more of for then XXXX, kind you're about us back help customers for about 'XX. your talking talking work think think improvement? of a XQ to that what into 'XX a what XXXX identify as we to they're but can exciting, we on then peers obviously your to kind you then and about and lot expecting are degree and you back looks guess this customers

Dale Redman

Each customer upon will navigate through situation. their particular QX based

cash think said free and peers it. within to you quarterly disciplined goals weather, that we're portfolio position customers at their a try that look in that what are holidays, that's utilization some we side. with QX, minimal Those to meet be their impact going should make standpoint. at I then, that will And that points from sure that seasonality stay that a in they're be they expect dealing flow. of seamlessly constraints our and or Four are to to a our looking work on with in that how that's we'll two things we the up of keep have calls within brought our one minimum the normal as budget them

Praveen Narra

but So, also is, talk whether versus sort XXXX capital capital? your as activity. cementing going buyback it drilling, had you for return of doing some a of growth in 'XX into or year, next customers on see share this mentioned you indicated about Can allocation we for side of some think how the you about frac some potentially

Dale Redman

topic broken can all table. weekly a you, that's just tell options a know I basis. Praveen, I record on a sound the on but those here are like we And of

We those of for are anything discussing are plan Praveen, with ready today. announce XXXX, all the to

Praveen Narra

from last an one you can just And me quarter-over-quarter? just the one and on zipper frac update give efficiencies uplift on stages maybe percentages us

Dale Redman

from pump X%. stage QX. is XX% went XX% actually in Total quarter-over-quarter frac Zipper up QX in was to

Operator

question next O'Leary Our Pickering, Co. come & will of Holt from George Tudor,

George O'Leary

on I Following to appreciate question in on zipper Praveen's and color the stages. fracs

also hours metric key a to have about being You pumped talked guys watch.

basis. day curious pumped just hours you where sit per month per So, on an

operating fleets a thinking a bit I However, how any understand you color back guys your some hours, would so be there the gauge. Delaware, maybe frame are that's different and it your trended -- to stages of quarter-over-quarter stepping about get of from helpful? a and little fleets animal, super and of in more that

Dale Redman

It slightly was to QX up QX. from just quarter-over-quarter

George O'Leary

guys And just things on initiatives those than CapEx Is CapEx more bit, are what's a the the mentioned have consumable little mostly talked you and valves to specifically focused but it or fluid side then, you maintenance on broad that? that seats, reduce in you is ends put it about place, levels? like maintenance guys you

Dale Redman

it's side trailers. affect broad we've emphasis the fluid to think, these equation. I is far got Well, of component as all end highest parts the as the trying that on of the Obviously, pump

XX% XX%. have tell at were was you the that from in dollars. our you to tell primarily guys in that on loss absolute QX fluid actually that, by numbers look directionally down the can sale release about you that maintenance down if total does I QX you to was found I ends relate actually as CapEx can So, quarter-over-quarter in quarter-over-quarter

can on QX pretty it's the for we evidence it's QX, something direction. QX yet heading early in any right exactly a call. tell directionally, guided thus to So, conclusions, where was the of have I spike. in the heading we It's neighborhood draw to you but we far, idea be through XXXX. that revenue. will end guided maintenance X% that's we believe should with normalized said, of the projected that us CapEx pricing. that to With And of historically, somewhere have the trend of continue the all in

line working really have normal that, that kind sand work, a upon our to regional that top being top And With based in to now, the of with change effect line sand. on of by you probably significant it. the prospectively new guidance we year of you we're X% revenue for but in I And and the addition right regional XXXX driven our the should intensity basis. tick of on prospective from that X% a X% come can will our that total a that numbers would number, tell to change up of that's above I how forecast just revenue and the

George O'Leary

What incremental a wonder, on giving if just what investments of and well could oriented that about within a it's and count, relation from maybe pressure pricing the well relative activity of pumping seeing then tied more to a you're but could from revenues construction cementing guys of kind market talk The side little is Dale, seeing more the you're segment? bit making you of side, you and an size cementing the a the you frame that cementing an area of business us standpoint keep I business.

Dale Redman

strong, same and segment. seeing to that let is I'll itself. we're that the locations speak operating Well, powers is sees rig rigs revenue to really, really a strong, is size I'll them on try serving. everybody demand have nobody It's in business activity there type and that strong, space Jeff is bit and the on waiting the we the that still little

that a organically metrics methodology and but So, we a payback see fleets same as the are better really continue better that in space. customers, to good that clear just team, than are path well, to that very grow frac really good margins business at our little

Jeff Smith

far equates $XXX,XXX margins with months generating month those probably to revenue on cementing about probably XX% one As months. those payback payback of metrics XX which the per to additional out the two each years at XX% units some we're XX of incremental units as of

Operator

James question The from next Wicklund come will Credit Suisse. of

James Wicklund

a saying, if Congratulations. the face delivered of in it of on. have And so deal bragging great it's definitely you ain't reminded true. and I'm of guys a skepticism

great pricing it a of couple was in we overall there customers in spread if per did your Does cause pressure from in the to concessions EBITDA renegotiate it would Has down margin, job slowdown You from terms of industry the where try I'm and price ago. of wondering, economic any you get quarters your other pressure spot any to and pumping laid keep other down spreads is follow-through about getting telling the in they on spot or try obviously per slowdown a pricing been down year. reduction you.

to However, want base it? you are that Have that we from or customer use. your you whatever metric insulated seen in

Dale Redman

involved a and But folks they've this you point the drops be Very ways in to position, there there's my lot I performance mean, been and all on that for and guess disciplined we in answer space. of has the they're know acreage you that customer they're base softness develop there, going I some and location areas price, and and know going manufacturing have, to confusing to what are done mode. to these moving acreage efficiency

in If customers. well the our me and economics making with economics of their heard line you've about well-being you're talk well

we to have look built planned developed with this going is if recovery, the XXXX how continue, very equipment, within our this think the I we've payback to don't are and going of priced be can got been take we've it's over we making care I how on platform sure and we're those growth and more transparent best location. methodically soon. and be people and through clear We and constantly know to well at metrics economics how keep to you the we've

this XXXX. that busy think these I the guys next here the industry exciting going time to are their teaming at to in And acreage they're the decades, It's that up be that very, they're to and knows here and with positions different, going looking be developing and very year. frame. be business looking everybody much are for over a and plan and partnering people at

how have that's not answered we're this question, but may that So, your situation. viewing

James Wicklund

get a you have for that work and up for mean, Permian by me it to the backing customers good model be appreciate show don't it. the you're a of so What working for taking the you doesn't the that if do are Well, now. the other to are this contact one? know follow-up the to obviously doing far, you I My better of business so reality, could, it Permian. have very explanation, and obviously happen? you I Bakken good they is pretty as Permian, was tempted good, your are very some stopped so Is there in customers relationship the your kind take as actually I'd customer dragged customers the to places different you was reality than why well job all I why if you me basins have real other in contact people coming a you big, if your operations and high the Is and how up are, with

Dale Redman

serve and base Well, and I where acreage have they other look the we places. mean, who position first at of all customer

better from getting outside not than the and the to platform probably and is what say, place quarter-over-quarter there we're results be lot go fact a we right It's and precludes of time and not the our do I day, business and a here thing, we do and out are getting of now, no work, want do here. to a other we got we we're lot to manage there's doubt, every not will that's the base we're just win being able anywhere build focused that a operating the would us perform to a here all. Jim going so So, nothing where anywhere at reason because here there's And many this we have build to can still this issue.

James Wicklund

And half Can will XXXX we horsepower broad could, or we yet. of at your a expected second But give all least. could if busier about back not discussion busy year you I one should idea additional the for to or talk preliminary said a budgets about finished backyard, I XXXX? but yet, understand. definitely us be through it's of work might follow-up, be much haven't I put if you will being I the year, know leave what how you a

Dale Redman

time, there in opportunities our disciplined guidance as of will but not to we coming as we're to whole really with going I have Yes, lot and use opportunity can't time, But but growth to discussions having early stay that, together tell to can we to of about there on it's at can, yes. for those and a several our talk yes. are have been months discussions I capacity for this try in adding be we what you budgets throttle give guidance giving this any and provide you think lot for Are customers, balance , we we're XXXX. a Are are too the growth, that. we going sheet

Operator

next Our Instructions] Simmons of question will Energy. John [Operator come from Daniel

John Daniel

fleet On for XXXX, existing next incremental your asking year? are customers

Dale Redman

visibility, will enough customer have We added base. be to existing our needs there

John Daniel

they're your anticipate expanding Do their added those one needs are you operations? that or performing you're lesser peers of displacing

Dale Redman

So, probably has I There you customer pretty if been but happened combination, within some think, sized our good it's what's at a look base. acquisitions.

John Daniel

Yes.

Dale Redman

of will a a the be opportunity. combination from above growth all it So,

John Daniel

is think in said, Can sound two to like might to I -- given just X% a not really utilization, And etcetera. much X% one impacts that have loss much. for you very holiday you then doesn't of points percentage manage utilization? it better to on help the expectations QX, right matters you that But that that only

Jeff Smith

tell of lost or I upon a the up I point based -- us just two we rigs. can Yes, of that, that back to QX, you, think, running even a in primarily what drilling utilization lost we clarify

people about, it affect of top would that weather. So, into the the slightly that, QX. on then frac talked of effects of that continue did in probably and expect efficiency seasonal would And QX. probably holiday lot normal factor We even a you have to time layer us

Operator

come Merrill Bank question Mulvehill of from will Chase America Lynch. of next Our

Chase Mulvehill

guess to know but we could you JD's says question; maybe coming said lot, I translate that October. I It came the of flattish like quantify my model you you follow-up of don't hit into stage couple got or that a less didn't on about think look more count if utilization kind count. that. of fleet I at points you've a in, you If sound a stage utilization. given in that fleet kind the know

So, understand into and translate help count? me that stage

Dale Redman

mean, tell a stages in increase is in total QX, pumped you stages slight we I a Well, and had can per all slight fleet. I increase pumped

probably our -- and have being, planning bit that year a the were little would last to want expected comparable something seasonality Okay, In effect contrary QX, actually efficiency for year down those talked this presume of just QX. on the we that increase be be I year what up But of a I in bit holiday competitors. we're whatever so frac say, holiday time, down We you our we're than will have is factor competitors little might I whereas we've longer that same that effect, more. didn't to transpire fleet it probably but weather can would that say, time absent we'll I seen last would about. tell you to even

as XXXX. translate actually that can't specific in won't was as it I into but So, it numbers, dramatic be

Chase Mulvehill

can per some about of your pieces stage sand you renegotiations versus And with then, on kind the think it you the moving in about openers dedicated as maybe of see we of fleets. price any fourth kind when had talk you for quarter; revenue have

Just in fourth be quarter maybe on helpful? revenue the progression would some per stage

Dale Redman

sand we the the in stage XX% for know that to QX it's thing continuation even a be XX%. to we in We Well, effect going have that's per that is we're in to going a you're regional go line. not number effect going pricing that top is the to flat. sure is had of go of one driver of be and QX. primary QX exactly where to higher were percentage anticipating -- QX, do affecting revenue in But higher to The the than is going going

get effect going of the continuing you're So, that. to

You had XXX% Northern do the next XXX% switches know, sand our regional XX% Sand, previous in in normalized was if fleet that ticket. to White sand you with a was White and a of in XX% the Northern pricing quarter quarter.

XX% now that less talking You're about using sand is to XX% in cost.

Northern So, in line that top to from XXX% in theory to a the White XX% where to want affected Regional. would change XX% a case translate a you

Chase Mulvehill

early that you And the would then in the fourth in zipper fracs frac so indicate would your Are quarter. quarter? slide third are in in lower that fourth October far quarter, November they seeing anything really strong mix in zipper the

Dale Redman

would I QX. relatively if would say, anticipate flat you're over for we QX

Chase Mulvehill

EBITDA all I think mean, your per this and about up? it as then down, pumping translate EBITDA fourth fleet, flat, And for the outlook per we for fleet. pressure What's quarter is your

Jeff Smith

would it Given slightly. down seasonality. effects that We the suspect of be would

Chase Mulvehill

loss disposal for on the in And fourth the outlook quarter?

Jeff Smith

would that based what upon up QX end mean, in of I with would I less activity the in a I guess, somewhere of you down had quarter. a may if the we little a little bit, be seasonality hope bit it be comfortable

it down expect slightly. to might be You

Chase Mulvehill

have you do that heartburn? contracts cause any sand then And you contracts, sand on

Jeff Smith

of situations. a and we to take to downturn. very the we or spot have enough contract advantage very, confident where take in work into it's leeway at same to And sand when access time supply that we No, have hard feel ourselves pay without pricing enough hopefully locking

Chase Mulvehill

Last right. back over. I'll turn and All it one

CapEx And On of What was XQ. expect this in fourth percentage XQ. in the in then fall revenues you CapEx, you to do was down on quarter it maintenance where maintenance said, revenues? XX% a percent of

Jeff Smith

We're that the just probably tick It in number guidance was to can tell and you our X%. a I changing above X% QX.

Chase Mulvehill

was fluid that tick ends? that much of of and above Okay, X%, how

Jeff Smith

Fluid our CapEx ends is number. above typically maintenance of XX%

Operator

from Our will of next come Gendron question research. Wolfe Blake

Blake Gendron

your of to a and more about equipment R&M see that in I backup equipment probably It sort you maintenance going in we're on refurb many somebody rotates to hone crew story. pads. R&M Are guess. guys specifically Delaware, kind predictive somebody side little in pumpers are a moving the the guess, that up better of how to that of blow for impact, your pull are and I does just basin I a Are able you how forward your view like lot backups competitors Delaware rotating within that pretty athlete bit operations of pressure a among of you heard around still then Is the operations When reactionary basically forward. on as we've wanted think manner. seems or Midland set site? you just between time

Dale Redman

the I company think it's to the we've historically. in the the built with that been our than the same Midland different model And any in primarily Delaware. Basin same that is is approach not equipment

Blake Gendron

into tailwind. ducks efficiencies about to tend And be much not that all which just to up you mentioned talking rigs, customers your the a running then build seems

can customers that getting spot the the your mode. risk between work into as in to demand you back development as the you running of about efficiency XXXX main customers in your the As of going conversation we year-end, to pads frame think is but into their How you here some find the XXXX the do softens market to ready? in with Or risks into be just potentially mitigate move such rigs.

Dale Redman

we that's on that people done the customer work a ProPetro Blake, for and side the for not so efficient base with I they think the such concern great have serve. a job are we drilling

Jeff Smith

mentioned in I've anyway in. of spot what little able customer for either bit is some it's bit equipment But QX, to down of our had of what we've a of extent, able of you or that find existing fleets to to-date little based been some that that. an -- reallocate a help the upon we've effect to been do base if to Yes, probably that fill need may work among those

Blake Gendron

adequate and Delaware remind to split then you how growth And could the with And think in last us one, do go Midland? XXXX, then what you about just those sub-basins? into understood. Okay, between two mode scale the respect again is you

Dale Redman

issue got how and customers that that the over out four by continue serve be develop position we'll run acreage scale and forward that How the talked I've about there assets opportunity time pump. out see that's they the size to that not growth an the for presently. Midland we exist or business. you we've public to allocate XX we dictated Obviously, in the this since can Obviously, expand XX of that of Growth plays becoming and company. to how in and the going the can Delaware how will opportunity is the

Operator

from Our of SunTrust. Instructions] question Sill come [Operator next Ken will

Ken Sill

to it hard how is are what guys do you know I doing.

So pretty it's impressive.

So, guidance. one the question on

year bad be last pretty sequentially. going it's as drop not significant per said You in as you year, to a last had fleet EBITDA

five talking talking as of days a lower thousand last points hundred bit sand, seeing on bad more assuming not little a couple per or as drop which XXX,XXX, EBITDA about for off are like mean, sequentially about or couple maybe, was We're revenue XXX,XXX? year four I So you we're of quarter a down, I'm holidays. lower definitely

Dale Redman

having plan Ken. of the what and land about, much our more last think, holiday's them. with year how rewarded And I time we year, extended what been and a this people our collaborative on at had as talking just, we little that little we've we we looking different, vacation don't a we Yes, customers, done because were

XQ off we're strong gas, with to to and as really come. a and they fluid things deal we'll it very it's about those So excited

Ken Sill

hopefully Well, better. much outlook the because is care about XQ won't anyway people

we've of to back. impact having any to try if looking this go know of, or and fleet everybody equipment you back? shorter on suppliers going things lead terms grew add debating, come to are five you to capacity you we still six months than were, this build to temporary some up they if is are Is a go kind and in So, fast lull how got were at time

Dale Redman

Ken, six still five and that supplier holds month that I think, wouldn't with we probably move to that true from time-frame. our

Ken Sill

QX it better looking, if QX? wouldn't in are more, until be that you are we where So, model today, would or you're probably late things getting

Dale Redman

fair. that's Yes,

Ken Sill

if anymore. asked and I'll Thanks. questions else so ask Most somebody of the let modeling there's have

Operator

next Our from of will question Kurt RBC. come Hallead

Kurt Hallead

top and how that in expectations head guys relates topics one button ask are as maybe to to XXXX the you that right it those maybe have, for were we but discussions their into more changed? going next customer to into performance of extension button hot as your So, I'm base, specifically as would vendor evolved or then kind performance hot with what have your frac curious and three topics be, I and your customers have year, for if general,

Dale Redman

with The question conversations. extent have those efforts collaborative of you customers can when here we it need we have get it about is and the the our that's if not Kurt, changed.

Kurt Hallead

cracking, to we So, be get who get and to we job there's stuff here when of somebody a got going to to say We be going lot need got the do. get done they to get no and reliable. they're here dynamics, just is other able

been from no what E&B companies their have really are there expecting So, vendors? shifts the all in at

Dale Redman

specifically, us no to narrative. change No, in

Kurt Hallead

that that, you've I couple fleet through And growth you varying any issue a can committing growth understand dynamics. be expansion So, answers have could or anything fleet pump or an lines. not M&A current next your obviously not referenced think right, a from more those would is beyond to on go far to but going that that respect is and year, along so the unless expansion there of to and squeezed that kind questions fleet times different for into

can standpoint just squeezed utilization a assets maybe wonder, from you that from Is if that growth? your kind I be could more drive put of that So, current in context. could of there some

Dale Redman

zipper fracs little of as have to squeezes gets put. that XX%, in And more a move where XX comes somewhat then probably there. can go and we that and percent you ahead. paying No, go Maybe that's still it bit plus room that to, obviously, us

Kurt Hallead

sand should it right. revenue as Okay. the really sand? mix income it relates. as impact level Jeff, on ultimate to pump? at you or provided relates on How that flow some through and on dynamics Maybe on good the Jeff impact color What's shift for EBITDA for frac we the this think operating the about

Jeff Smith

all QX contracted pricing of of price do regional a had price contracted QX more margin sand QX. back Well, a with paid you in there's a growth to the QX, trajectory say months, actually spot the QX QX. would lower coupled that our that spot certainly but the sand from what average won't had still benefit bit I substantially to was for to several that of we've to impact benefit, the going than in a coming contributed probably is lot sand from itself go it nearly last the got lot more given with room online, we in to the that price saw we little declining at That in be QX. on

Kurt Hallead

some get updates live infrastructure reading you're ability that infrastructure single an whether improved seeing some logistics from ability material lately to and to the on guys been that and I job the so if wonder in it us you give every it, improvement day. breathe you I've improved, suggesting can job? the the to have around here in the on dynamics Permian get was and have

Jeff Smith

issue at much Yes, had that we've all. never of

ability standpoint. on we're as having there do lot So, affecting far it's do, and there. lot people not what of roads from Obviously, probably the are activity, logistics we're those we're one active we a but a as to and problems not struggling more a of and a that with here in that our operate more lot

Operator

Ladies Redman and remarks. like turn Mr. question-and-answer session. the this will Dale time, this conclude At to to conference gentlemen, I'd closing back any our for over

Dale Redman

express great just supply hard I customers, appreciate work And thanks support, Thank your and your have and partners, our I our really efforts a people, and another to chain Ma'am. day. quarter. our to sincere you, our want all our good stakeholders for

Operator

The conference Thank today's concluded. now attending presentation. is for you

may now disconnect. You

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