ProPetro Holding (PUMP) 8 May 192019 Q1 Earnings call transcript

Company Profile

Participants

Sam Sledge	Director of Investor Relations
Dale Redman	Chief Executive Officer
Jeff Smith	Chief Financial Officer
George O'Leary	Tudor, Pickering, Holt & Co
Tommy Moll	Stephens
Jud Bailey	Wells Fargo
Sean Meakim	JPMorgan
John Daniel	Simmons Energy
Praveen Narra	Raymond James
Vebs Vaishnav	Howard Weil
Harry Pollans	Bank of America
John Daniel	Simmons Energy

Call transcript

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Operator

Good morning, and welcome to the ProPetro Holding Corporation First Quarter 2019 Earnings Conference Call. [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, and good morning, everyone. in participation your appreciate today’s call. We

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

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

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

call the to with I’ll that, So turn Dale. over

Dale Redman

everyone. Thanks, call. us Sam, and joining morning, you We good appreciate for today’s

another to to very on this the well execution, customers. that year. off at with Coming And quarter premier basin. resource the remained off year beginning in site performance has our a first the by was by focused operation our the focus, customer outstanding yet Permian of team the serving start operating portfolio of a in impressive play of The XXXX needs our best-in-class team, our fast allowed supported coupled an world, XXXX, in get

financial like provide step increase well forward the Our first utilization produced a I outstanding would quarter more highlights. soon, another some efficiencies. was quarter million quarter. from the be proud exhibited legacy teammates expectations, process this process. of have and here This of the with performing quarter-over-quarter service has Natural assets part newly step-change the and our Pioneer. those integration and utilization XX% for the of million and also ProPetro. we integration from saw to came integration increase XXXX. purchased more Driving of per Total remained entered could was workforce $XXX.X adjusted and $XX.X the our XX% we exceeded the site efficient a Pioneer Jeff financial million, in the million, diluted further of is details results. income both for was And into will but $XXX.X Pioneer of and revenue This new and during the equipment team performance the yet validation and from that that Net the assets XX% high enjoy The share was that operations quarter. we at proven personnel with has an bench $X.XX high for few previous depth EBITDA financial already the previous quarter a $XXX.X in fourth the quarter value of focus we quarter share, not long-term our leadership professionalism an from the increase big Resources, of in strong or of agreement

mentioned outstanding was our I site the to well As also quarter earlier, in success financial contributing efficiencies.

our stages rise saw of percentage XX%. zipper pumped stages total During the as to quarter, a we

large, amounts to well our access high-priority pads site. throughput increasing customers of to Our at continued the continues from produce

sands across a site well cannot to West of Texas see adoption sourced regional continued continued operations. source of positive our Texas. of importance right the these We XX% Permian products parts the effects West numerous has seeing are on sand. of ability the In quarter, regionally our all was look sand in logistics regional we the We to be to closer also It purchased adoption basin. here overstated. of The

we Over about within We as that remain keys sector. have lot efficiencies largest foresee profitability pressure this the and of pumping the past sector. for performance are trend talked being the our well a year, will to fact differentiated both site efficiencies performance and utilization continuing drivers and well the

it Our differentiate consistently to Jeff ability continue over constantly through service of a our more detailed for striving now for our discussion a team. will our predictable And financial team is I to this Jeff? to our customers value produce do will high-performing, offering. turn performance. to

Jeff Smith

efforts Thanks, Dale. field. continued our for and I would customers their like team our the thank in to also

XXXX. $XXX.X our size Cost first was quarter. of and increase the primarily million levels. $XXX.X horsepower during the sequential depreciation $XXX.X activity Looking fleet our for excluding attributable the for of XXX,XXX amortization million $XXX.X specifically increased of of of primarily results million XXXX, first XXXX services to due the for and acquisition from million December the XXXX. XX, to increased The to at from quarter quarter Revenue increased to quarter fourth on fourth

per to of quarter million the cost fourth of and XX% quarter. increased As $XXX.X pressure connection $XX.X million Adjusted versus relatively and quarter General IPO XXXX quarter revenues, in the from quarter of or expense first of increase administrative of margin for a pumping pressure compared XXXX. diluted for $XX.X segment stock-based first first the for in $X.XX to flat was million the Pioneer. as XX.X% XXXX remained XXXX the or bonus of Adjusted XX.X% million XXXX. EBITDA previous for was the The or quarter expense, for of first Net million XXXX. income compared attributable share $XX.X share transaction administrative fourth totaled as retention million at first primarily the $XXX.X of was for approximately fourth exclusive our percentage per the $XX of pumping quarter EBITDA and was to X.X% revenue added diluted around with services for of with XXXX. $XX.X from expense, million $X.XX quarter quarter deferred to of compensation, the overhead XX%. capacity General

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

quarter, first on million capital. capital growth as expenditures ProPetro’s as the for initiatives we of maintenance spending During well incurred $XX.X

was $XXX.X the December liquidity Finally, cash, of million, of total under up and including XX capacity ABL. – as $XX.X million available

remain generation As turn Dale. that, in possible back near-term cash With the said towards have it we from repayment. past, initiatives shareholder return I’ll all to with future the debt proceeds table prioritized on

Dale Redman

Jeff. Thanks,

performance, of opportunities form come allows we through Because new of As stated technologies of in ability level our I on team very the have many unique employing these perform the us opportunities. customer the trust our highest earlier, at to location. earned

test of a pump fourth in our may you many technology able sites were AFGlobal. the As job we one that XXXX, of supplier, developed of new know, was by long-term quarter on our to

recent novel had like our field in offers equipment manpower they effective for the fleets. the horsepower and legacy of us advantages, frac and of XX% and about has deliver to place acquisition, a at DuraStim XX% the and to you times AFGlobal’s footprint When AFGlobal cost. with This talk business X,XXX extend our fleet anticipate at in have the us down pump an year and and unit proven life competition. to while coupled this and conventional a chain, fuel potential late the emissions. that relationships horsepower the successful reduction of cyclic trial with and DuraStim equivalent frac significant The in is orders electric relationships value to nearly approximately development it of drive, ally the system, of we Before to be our a equipment manufactured will led – reduce are rate. substantial a reduction last the the our DuraStim DuraStim great two pump outperform about. grow expected including many maintenance three hear first talking the pump full operating us dramatically We our consistently allowing up consumption is frac also offer

number game-changing why confidently oversupplied well This in. with led have to we to experience. market in down specific DuraStim, is our to is our outcomes conversations it with a and and this rather conditions more help high-intensity of AFGlobal it conclusions. market cost the We undersupplied experience drives service Current within technology three to currently to us will provides deploying on-location frac not lead but has regarding operating chosen our industry quality get that suitable customers the solutions and to is we the to and pad continue also to equipment believe is are our relationship that sector development that vast for and quieter predictable multiple with lead customer. us Through that a is market safer clear technology

the in and strongly for that consistency we mobility. upward sector search First, opportunities is our believe within that constantly provide workforce

are to constantly improved customers shareholders collaborate Second, our arena. Based through-cycle to right has we efficiency. our customers that us conclusions, in for innovate lead willing is significant there are capital charge investment are we discovered easy to it and in in of where that the community need the on compete value. that see and and these sector as this of changes that returns to is been Last, have service drive search in that opportunities upstream quality providers equipment employees, consistently believe allow to proud we need to

visibility XXXX that in for to with are challenge activity laterals, we and operators demand very We a remainder to longer the welcome continued partnering increasing of pad A off services. oil and pumping we the the the forward Permian, about a bifurcate are look and for and in strong market development, the our to the volumes pressure and We basin’s produce continue macro transition optimistic this our days best more start working to year. quality in the will frac we and view of efficient enhances Permian. strong strong believe

to at us on also power edge allowing of excited to earning the to We well cost customers, strengthen are our over technology down to while our the time allow therefore for the time chain all driving be same cutting collaboration of We as and competitive remain the our consistent continued drive we strive to on global our returns. and to Basin Permian competitive a forward customers value scale. in partners close look with

We it questions. Gary? will now for open up

Operator

question & ahead. Holt Tudor, Please Pickering, [Operator from comes with Instructions] O'Leary first George Co. Our go

George O'Leary

color going. potential those on just some had with those dialogue all wondered e-frac that’s fleets is exciting. fleets just and the dedicating you’ve contracting you intriguing outlook the how with for The stuff customers maybe or could folks, certainly what I and provide if

Jeff Smith

And very Yes. field George, our time in a it been conversations year. are see really with had test and the would the question. result to tested and every it’s And are very the obviously, later I good and encouraging. how good the say conventional since very very we’ve first have inquiring we one And our anxious need well-received. on is of customers see lot Those fleets. in of

George O'Leary

Okay. Great. whether cost discussion. one turbines on what us own then And color whether right e-frac you the the e-frac fleets? to or then some the route, of go – these lease power Could them. the on And I do you’ll side, guys had going you power-gen are put distributed the on help you’ll

Just any would there color be helpful.

Dale Redman

talk about The turbine side. financial will work couple and side let And are talk we’ll early on, then our we’ll very fleet, George. side it’s it. customer-by-customer. power it I’ll of Jeff of in and I’ll collaborate through which in excited first be power providing first the be economic about turbine And with that, the manner them conversation it, the we’ll the fleets, of on on

Jeff Smith

the the $XX we’re the to economics number totally But itself as comparable to depending the investment about, in of equipment, to As of of costs the the the payback CapEx, these $XX pricing far be And first source, fleets. ancillary going look cost well conventional conventional the to the the you form comparable fleet savings that two million. all-in Exactly – going $XX the DuraStim on what fleets. And customer or to on fleets decision is potential conventional power million. million as we’re than our for fleets, periods fleet maintenance – as and expense power better at one these on comparable $XX is the on total generation, in today. what DuraStim assumed fleet investment if better with is if of desires OpEx our or provide was. cost far these of thesis We what both the top as factor that as million us estimating our is making

George O'Leary

bless me, this I guys Okay. resilience fleets super-impressive. I’ll either it outperforming did guys That’s of EBITDA any sneak put helpful seems wonder in and/or clearly process in of of the was bigger quarter, per you very very look more, expectations, margin per you that the I magnitude if I terms expectations. on the at Pioneer driver could color. just fleet kind per provide thought of and which to given one you fleet profitability strong up fleet’s the could. was fleet maybe if that To it quarter. the this color the outperforming then that of beat legacy When imply the

Dale Redman

that, going year metrics. the think George, manufacturing any done just have XX-hour encouraged about accomplishing financial mode more best site. in To – board to And that from. what team to stay been a with impact will our clear more way the is handle we last that’s what away what we’ve is for this is we’re granular about things And your this on across our period. unbelievable. is getting is I on and of the get on But efficiency delivering team’s very

Operator

Tommy with next question Stephens. Please ahead. The comes from Moll go

Tommy Moll

I picture on and wanted the start with to DuraStim electric. bigger

You’ve it’s technology. been as customers, lot But anyway, be collaborating for them new to supplier with. less Dale, for going with developed something some for alluded earlier, that your they’re a time to your you this now. equipment of familiar They’ve

captures to terms You fuel, I new be you of the term. maintenance, it’s that question my big interested to in And as dedicated of so trust savings partnership, how got a et a fleet be long But and who something to win-win of open going labor, get it maybe it’s there’s it’s some trying do of is just and in that, And different? to cetera? underpinning mentioned willing trust is But fair fundamentally split new? part you how it’s that just to factor element a it. to then there’s that them think get do all a model, got from be and a

Dale Redman

to this speaks I we’ve how relationships. developed these – Tommy,

with very our okay? are economics, But our and equipment with getting going be a customers more done technology. comfortable that is is this our that they’re not close AFGlobal bringing in me trying tirelessly this a – everything. early in anything single around, trial, a XX-hour long with that’s – our But less change box with been lot Let checks clear. last with get of ways we’re interested has over period relationship there’s technology wealth customers problems. more None things And to hasn’t And something that in AFGlobal cost worked this five from validating perfect. every it’s what of a their the interested years to can

lead I proud it’s are to this conventional emission and looking industry’s going are that. not just lasts better that every safer, be that there of the change. But time checks long longer, that from to And for metrics. for and we’re think fleets this charge. mean yes, So a box, tremendous equipment quieter, This does needs are going away, type

Tommy Moll

there, Well, is headed. this all and where just Dale, following on

You’re a on With the on you’re first design run new electric. now pump platform the combining mover in DuraStim, Permian. the largest

So opportunity point out you’re would taking proves that, DuraStim to hoping, much how batting some if thing here? in future. for much higher bigger set I more the than a as the assume continue number and you’re at that just market be couple share of fleets these this is

Dale Redman

with we This think most we been – gave basin. it’s we’ll this be application. what will balance the a asks could that The it balance of lot just I are. used we and questions disciplined capital. one on the the got base. sheet we’ll gas the how mean, I how – that, very allocate that active There’s answer governor be natural customer be Look, to is customer on Tommy, Yes. you And a for tremendous of I received.

we’re in as what really you and of company. excited to this unique of we’re a position the kind So out about future laid extremely means our

Operator

The ahead. Bailey next with Jud question comes Wells go Fargo. Please from

Jud Bailey

release give the fleet the XX the your on work count of there. to kind color second your And could to see some was some opportunity in second and Just of bit in little XX what’s the curious in us you visibility work. for I active a put there the hoping first quarter. versus on is work any on fleets quarter of commentary driving on during Question how quarter? decline the expecting you

Dale Redman

Yes.

of doing were out very me clear fleets that and as into more could integration on we Let to a you got lose acquisition an want simple found read Coming more as any those be of out out that integration, at means. and with anything out we one fortunate came do what cadence don’t of they we so capacity – you’re that in found time Don’t We it. sure you’ve It’s less. QX you how make of this. process. QX, Pioneer and with big

during So QX. through and And not it’s simple as as fleet QX QX we’ve needing balanced. that chosen – after

and have we availability use XX could that’s way change, operations for financial we’re there. able Our the should the come reach – and of those balanced model. allocate way QX, all team to should And our to be That financial to what’s metrics our And the needs. horsepower going best but we’re fleets. team that run conclusion to we to going

Jud Bailey

the in you get color we at that down? about is we flattish about think per helps there per the on any slightly and think stays fleet? need EBITDA consolidated fleet you trajectory bit that, down think a or maybe – EBITDA pricing like you us does fleet. per that then anticipate Help there. element should stages Or stronger appreciate sound to EBITDA Should we fleet? to things better And per about I XQ. XX. Okay. the efficiency How Typically, little

Jeff Smith

that mentioned that QX. Dale quarter. you more or down. modeling it for efficient was an purposes, extremely flattish That’s a by the I tell be in stages per potentially our slightly had driven think digits opening double fleet in And can percentage QX. fact also for we XX% his remarks up that QX I zipper should were

doesn’t there QX was very So achieve as as still mean efficient. but There’s potential better. or can’t far upside efficiency goes, that we

So going we efficiencies – those slightly from separate so a that would down flat to QX. in fact would I – XX or with coupled XX, QX, we towards QX’s potentially guide units would were even great, of the for hair revenue-producing

Operator

ahead. JPMorgan. The Sean next Meakim comes go from question Please with

Sean Meakim

if just So clarification, points couple of a of could. I

I not think $XX planning that can. clarify, on – to the guess on source you’re when not outlay. to putting how the if change I can I customer? the sheet I if million you’re assume to – so terms you’d to not? providing make to that indifferent the on if clear, power that on balance e-frac, that just suppose, it’s have you e-fleets, or decision? Or would think I your you prefer $XX not the terms I’m commercial with you you have million call in guess, that of that or avoid And

So you be would of and little of piece takes the puts us that bit that can bit maybe economics helpful. a there, and the better a just understand help

Jeff Smith

No.

to source think to acceptable. drive turbine, I and economics I the the that let we want the the decision. to If periods what initial – savings as that it. find offset customer as the let Dale we make payback the on the whether said, provide we But usual they will we’re at – those economics we customer against provide we cost payback think upfront are cost very as that that based going they fuel provide it, power this, or – let decision with that

us have so As Dale actually source, that. power fleets, sourcing first provide the we two are they that said, on asked to

Sean Meakim

Got it.

the rewarding Dale with Pioneer the it Okay. start fleets, a sure strong been less. And integration. team. on And obviously on more mentioned doing for that’s the looks like I’m then

that So get fairway is making about, cadence and we feel evaluate do few do Jeff, talked a not you you there of what versus And how about think XQ let’s think ahead that like particularly be for just initial when you that hey, you you’ve how next you you’ll over But ourselves out reevaluating on Or laid you’ll the that revisiting think full the commitment about about fleet? good, of quarters? should done? do improvement how How guidance? comfortable here XQ.

Jeff Smith

begin actually process consistent I any that a Well, well their separate guys on modeling to from we fleets – upon can modeling guess fleets the how board. across that would on legacy would those extent fleets, went with give integration think stop the QX basis doing our of we the to fleets, all just based guidance you were you and

Operator

John with Energy. go The Please next Simmons Daniel comes question from ahead.

John Daniel

that lead that like, eight the hear we as the on as, of one from OEMs times months. Dale, turbines things are is much

ordered? can curious, So many I’m you you tell how turbines us just

Dale Redman

faster rest are John, No. assured, of at great I accepted – help we’ve much wouldn’t to what are that correct, we’ve done we’ve position long-lead most like now. great – But a care in you item. that should is just in be partners got supply to we’re able will things where of chain that the that. are And here to homework us right be speak a this those But that. – done than ProPetro, pace take needs in we’ve and we a

John Daniel

are right? I to the efficiencies. going, Fair need going is this enough. the where But And mean, market’s customers

savings. capture can guys You

to to companies. standpoint mean, two. a in lock defensive from So from make And the would presumably, you I before just sell make the sense they want to AFGlobal orders DuraStim it other supply than more frac continue to

here, So standpoint, be like seems assessment? it going DuraStim Is you are of unless opportunity great. my more is crack so a because smoking set guys fair fleets to I’m that the from adding

Dale Redman

the first to you won’t got fleet year. be the till Well, later here remember, in

part be homework. know done you need we’ve micro perspective, have lot a of a yes, But there’s that all from going to just we’re of So here. a to validation our

the business. how lead our and And in future disciplined to planning be and we’ll are responsible is we’re it. We roll glad out. we It it

John Daniel

large the DuraStim ahead for big programs healthy are Permian one assume first with of with me. customers looking two Safe I And growth them. E&Ps – guess Okay. or last to very then with the

Dale Redman

of I of all this be will our happy all we’re of And and with very them would all customers Yes. them technology. it. of say like a part

Operator

Marc The Banichi Cowen. comes ahead. next from go with question Please

Marc Banichi

Dale, power not you. for these at like capital point it sounds a fleets this the for is item

to seeing the have you guys least two how of for this or are Is planning sort it rent at You’re first lease currently a at some agreement. point? that

Jeff Smith

We No. those would acquire actually turbines.

Marc Banichi

Okay.

And then earlier, of that a, you Okay. your the kind XXXX given – would and numbers per the $XX CapEx. would would guys put of about so $XX million in to fleet. I you talked million sort in in reflected all be that suspect of that

So much implied $XXX you I’m $XXX wrong we the should kind the And newbuild earlier me the in hit that by gave think how of terms up if about million in of that. that going Correct kind CapEx. first of of million. then quarter by

Jeff Smith

No.

previously the That that there. You’re maintenance enough we’ve that million $X we guidance. a that year that, we portion What you With incurred was QX. than can in guidance CapEx line any of that relatively – CapEx not but CapEx I to maintenance that hair less tell us to regards fluid of in correct your $XX given. was ends. in includes the assumption million total actually with for was change the incurred QX what per XXs had fleet was of in

payments as as some the unit well unit that CapEx deposits and we that one that made we’ve cementing driven the by on DuraStim portion remaining progress fleets is ground on on the announced. primarily the is we there growth the put these first that in is one tubing coil so that two And

Marc Banichi

Okay.

half just the have, DuraStim. And like on eyeball you’ll Okay, maintenance then slide CapEx number. about If you’re it kind maintenance looks be of great. that – the I the you saying that is for here

taking literally be based about we as on terms your whatever think $X two we that to mean a of have? CapEx beyond we kind growth we out in the build when think you of this the fleet should in So million outyears maintenance

Jeff Smith

think But there on I Yes, obviously side CapEx Dale to maintenance – time as we yes, will test of are said. that yes. Yes. savings has And substantial equation. the that, tell, the mean

Marc Banichi

Great.

the that talk sand, and is XX% we could. about that of normalizes some passed as being On cost it’s from you now dynamics benefit. sand quarters, about all you to in very the How of through think at we last spot contracted what guys last sort ultimately here switching got Just sand? you Can a that I if pump, you one, the local of of there If a as proportion those I mark-to-market, your bunch everything quarter. large become customers? the to from look to suspect to of back first prices sort kind get to profitability. any your tailwind sort of talked profitability savings should of risk

Dale Redman

that see We as Yes. being flat.

is the sand. that I – about of think, dynamics sustainability Marc, what concerned you’re – we’re long-term of processed

So there’s a portion of that spot market.

haul sure But are there Are time. and sent some we’re spot profitable You’ve could seen over thing make to we that providers this you ton the long sub-$XX. want looking at that over do supply market go from plus, this looking to to the you’ve to of $XXX doing Yes. things a if sure get But sand here. we’re at take to what some long-term on make you’ve got advantage of through over decade you’re cyclicality prices? you the spot a those partners got

that. I So that’s to the think best way answer

Marc Banichi

Okay, Dale, great. Thanks turn I’ll it back.

Operator

next with question ahead. from James. Please The go Raymond comes Praveen Narra

Praveen Narra

to what how fleet fleets guess overhauls on how guess, about Basically, you overall investing on it’s guys, if think you morning in then your give could, making good you’re change conventional the thinking John’s a of fleet? terms can for sense great when further – major I how getting want as or even about you how And much and with this does looking I something. comfortable of this your question in to about up Hi, working, a part they see fleets? bigger wanted to in order us follow you’re quarter. orders. I conventional

Dale Redman

in question, lot that a it. I’ll try Praveen. simplify to – a down There’s break And Yes. what and bit that little

You I am. simple know how

going in reinvest our to existing fleet. We’re continue to

manufacturing/develop fortunate that to those keep this need the it high This I’ll they’ve part this look to pumping to with a it, customers And here, position at we goes, product And if are be all we checks partner. our desire. inventor metrics a it we’re a out, got laid these boxes. something going just checks and of with with DuraStim the have adapt. more to seen And see be to the our continuous customers metrics, performance tested it’s we’ve are and offering I is And boxes this met that reiterate all of the this and changes better of going change. pump, larger where more we’ve a disruptive. of good As It’s different think step that that to pump. will apparatus to easy again, what have very will and it it see be our assets in a out been be will

year? So are – we to asking if conventional giving if we’re going that we’re you this you’re No. building fleets guidance more

Praveen Narra

mentioned the of have this of That’s I presentation, guess for it. that your When of talk you you visibility perfect. – XXXX, outlook the your you second about And talk the about how into just remarks, in follow-up. you customers second terms half half are visibility approaching in year? can you about a think the Can

Dale Redman

position They’re Praveen, clear that’s of expected. price we the we sector. into The that’s the of who environment. visibility the customers sync the and in our this work got and investors macro for long-term oil beautiful what’s in trying here Permian. the Street they’re attract to in to great, And disciplined, do Yes. we thing are part same in are, are And very we’ve with

So we know plans. their

day-to-day to optimism that basis And great same in And guidance a visibility go-forward a just think season. on XXXX this the those going on basis and through plans. into going collaboration gives we they’re given cadence as us XXXX they’ve in earnings We’re stay of for and beyond.

Praveen Narra

Perfect, very thanks guys, good much job.

Operator

The next Howard Please Instructions] Weil. [Operator comes from with ahead. go Vebs question Vaishnav

Vebs Vaishnav

morning guys. good Hey, quarter and great

on So fleet. just touching Pioneer

contract. well. was to that’s for I’m fleet, any going are If go fee standby guess for and like, getting So that? as understanding the you I eighth one not mistaken, fleet going. work my the less But to was that think, I not from them

Dale Redman

with me When you horsepower we’ve location. out when here do that XXX,XXX the in we is seems coming XX,XXX do math, the fleet it, clarity. Canada operationally any let in And to comes transaction, And hiccups of don’t And the that refurbishment spread and it quarter was the make choose with roughly sure to to And on second you in give lot to have chosen that of rather in to equipment, we was made to kind be that’s And There’s nameplate to the confusion. Vebs, any we financial fleets. acquisition. to with out. There hurt But program. Yes. closed balanced as eight be model – got was did horsepower what what the team that confused. there not do. a way. doesn’t financial our it a need chosen the we’ve it XXth

great We’re and QX. that’s position QX, we’re in a over we’ll at. but need that’s to that where in we be where evaluate And

Vebs Vaishnav

for And sorry, standby you are getting a Or… paid that? fee

Dale Redman

Yes.

probably got That’s contract. a nuances into partner get the that great on not We’re side. of here. we’ve other to But not the appropriate going

We’re was purchased assets. going out that payback laid when the acquisition this meet to we the metrics

Vebs Vaishnav

to And sure Got want understand. I make that I it. just

Is how So like, same think, when we could electric paybacks Or fleets that making on today. of are should you by fleet to fleet, $XX that fleets million the X fleet? said million new you’re seeing what the divided years? million is $XX make like $XX X.X conventional that the like as a

Jeff Smith

profitability put on lot per it’s fleets. going way we the full to. yet to think have I think savings of that with you higher out that the But that here whether yet Well, We obviously, to is to actually their those there be that once feet think DuraStim just a it’s fleet there’s plays are up cost known first prove a ground. potential

Vebs Vaishnav

Got And question last it. for me.

Going more some more savings cost the the could everything. in cost like, how come process back we Where integrate way you to facilities have process? much was Pioneer, out and you’re the stuff savings and as are integrate going that can we from And a transaction? there’s say thought to

Dale Redman

know I that. we Yes. comment don’t that would on

location to on and end that how the what efficient this they people it’s day, say talk and your the what I been it’s the our get deserves. not is it At getting think have question probably about integration? the all It’s of and I focus both would is unbelievable in just done. what teams

we’re care want And to Vebs, location. sure with So we our we are the we’re that make good that really just seeing taken people of and like spot, a economics on in acquisition.

Vebs Vaishnav

All right, my for and thank question taking you again great a quarter.

Operator

Pollans ahead. The next Harry Bank go with America. from comes Please of question

Harry Pollans

us on the forward. noise through how Thanks Can we be you cash your guys. modeling working flow should going capital taking quarter. Look, And draw? cash capital for Hey, any in working walk one this question. my

Jeff Smith

to what past very statement week in was drove to that really of effect year very balance the collections on – QX That the happened to XX/XX. the is great kind for DSO the that statement. calendar was extraordinary XX/XX, normalize of kind XX/XX. QX history. you that change Well, saw with affect And you the really AR kind of dates AR we last what of in depressed cash the got back a which of had cash part. QX, that And – X/XX, and flow a our at itself flow at balance then when in the consistent what

really just extraordinary to at part at normality So a return and the it’s X/XX, XX/XX. kind was of

Harry Pollans

that see, I to forward, about is a And way think okay. there modeling good that? going

Jeff Smith

that to we that history, I use in DSO where past ought modeling consistent would purposes. at, at and be presume is whatever you and may presuming X/XX were there you with for

Harry Pollans

you. you much to Or XQ then much makes out? squeezed be do one are there – XQ? more much you more And on think Is get efficiency more efficiencies. above you How efficiency that that how runway sense. has? think Got That you’ll do more

Dale Redman

would spot where guide a differently. We think we any great in are we’re and not

Jeff Smith

better QX. Absolutely. the within there wouldn’t And – reference, lower it is Within potential I be calendars for is for future upon think QX based that model certainly frac I actually QX, that little of that, than the a QX, out. than anything guidance there giving way played bit could actually kind efficiency? we’re for improved

get believe don’t on can us out actually So QX we to. that where capped

Dale Redman

Yes, zipper is And Harry, we you over that as time. go XX% QX. by up? efficiency work. And that Could at were saw, driven

Harry Pollans

Okay, thanks guys. awesome

Operator

question a ahead. go follow-up Simmons Please Energy. with from next is John Daniel The

John Daniel

Dale, guys. quick one just one There’s units DuraStim on six fleet, Hey, DuraStim. the correct? per

Jeff Smith

Right.

John Daniel

on dramatic on forward, see than a So are what longer you’ll they units. conventional because the on expected reduction on fluid would last have have, end ends side, Do fewer fluid just fleet? you going the to DuraStim, you obviously the ends fluid

Dale Redman

Significantly longer.

Jeff Smith

And cheaper.

John Daniel

you news. Got good Thank it, guys.

Operator

over I conference for closing to turn Redman concludes to like would Dale remarks. session. our the This any back question-and-answer

Dale Redman

I awe for In I and again blessed the commend want serve industry that want for around to company, relentless it a to to humbly over improve our have their our today. life our customer also energy become have culture last base. I the men nation quality and you nation the independent. and Thank of and a years and help XXX has for the our the supporting of you day. sincere No built have into in pursuit for closing, the of you created our role had more important industry express that helping each admiration other is my the globe nations am citizens. in ProPetro respect women our as company incredible industry

Operator

concluded. The today’s conference has Thank attending for you presentation. now

You may disconnect. now

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