ProPetro Holding (PUMP) 2 Jun 202020 Q1 Earnings call transcript

Company Profile

Participants

Phillip Gobe	Chairman, Chief Executive Officer
Darin Holderness	Chief Financial Officer (interim)
Sam Sledge	Chief Strategy and Administrative Officer
Adam Muñoz	Senior Vice President, Operations
George O’Leary	Tudor Pickering Holt
Sean Meakim	JP Morgan
Tommy Moll	Stephens
Ian MacPherson	Simmons
Marc Bianchi	Cowen
Waqar Syed	AltaCorp Capital
Chase Mulvehill	Bank of America
Scott Gruber	Citigroup
Vaibhav Vaishnav	Scotiabank
Jacob Lundberg	Credit Suisse
Blake Gendron	Wolfe Research
John Daniel	Daniel Energy Partners

Call transcript

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Operator

Good morning and welcome to the ProPetro Holding Corp. first quarter 2020 conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation, there will be an opportunity to ask questions. you star question, your one a keypad. telephone ask may then press on To question, star please your withdraw To press then two. Please is being event note this recorded. Sam like conference Administrative now turn Sledge, to Officer. would and Chief I Strategy to over the go ahead. Please

Sam Sledge

Yesterday your Senior note Thanks the call. our Reform our in Operations, by comments quarter Vice events Executive first that earnings Phillip President Please call With We Officer, Financial or Muñoz. any Chief today’s Gobe; Securities Act. is of participation Chief and afternoon today Darin make everyone. XXXX. good Officer, projections are for expectations today’s on Litigation morning announcement the we appreciate Private covered we released me of Holderness; future forward-looking Adam and regarding statements of

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

current registered firm perform an to quarter annual financial financial its statements become of plan. XXXX. March XX, work its proposed and the quarterly the July committee’s remediation XXXX. to do company ended complete continues accounting currently so for reasonably additional audit delinquent and filing and Additionally, filings review it as granted on of for company’s annual to expiration information independent and of the evaluate diligently the public practicable period well the to its prior Management with statements internal of continues allow soon preparation to as to all to to reviews sufficiency trading audit to of in obligations provide XX, Commission scope accounting and is the to as NYSE filings The working our Exchange management quarterly and its independent to associated firm XXXX expects of allow registered it Securities the the the as the by findings, of public

Finally, the any prepared Phillip. however, after operations; related outstanding answer I’d our we any SEC to and our or our that, will questions the will call not remarks, to over respect we answer litigation. questions with internal With to turn results review, investigation, like the to

Phillip Gobe

Good Sam. morning everyone. Thanks

driven all-time first Looking our first and in results March. efficiencies the at rapid were Operational weeks the the high at were quarter, XX oilfield financial strong an results late until enjoyed by of declines in we a activity strong quarter.

is our focus execute to compelling to throughout our work. customers unmatched into and for example ability like Our thank the would this first their we team to expect competitive entire unique of to team’s an a maintain quarter recovery. our during I eventual advantages for dedication personally their downturn which

time with of and lockstep at and in our records reached the working fleets Our customers wellhead, per strong heights our surpassing pump standards. new partners safety upholding day

long act critical no saving driven is With profitability a Steps teachers professionals, opportunity operations, this and responders, costs safeguard taken volatility, medical to collaboration, on our expectation recovery. term struck, the term. their tide efforts than shrinking the business. to the like proactively through health the rose core our innovation of protect leadership enhance the a ramp, occasion selfless looking to enable take unprecedented the business a the in own pricing Looking decisively is near competencies our of stance our within firm and forward, core what doing on ride earnings pandemic to focusing rather take COVID-XX of decided the over when I’d unsung and and our include thank ProPetro community. of and operations to lot researchers to first amid of to A necessary the our power heroes to

impressed In our professionals. addition, to how for our our I’ve the teammates employees like and get customers. safely been with of standards responded quality high have done These allow true team job

this continue CDC the March in throughout late and according agencies to We operations our the May, safe other workforce. duration necessary to resulted to ensure market practices deteriorating to and and governmental implement reductions April of guidelines and pandemic. for best conditions in efficient Unfortunately

our of in to hard and their all years. work for customers We over are impacted the team dedication members grateful our serving

it we skills that prioritized to to services deliver respond protecting key retaining will make improve. to found market critical reductions, our safe and we capacity the While a efficient to prudent while these eventually

Sam pieces team market call Importantly, to to Sam? financial any our to that, respond condition. like the ready to core to turn this of our discuss stand I’d performance. over With

Sam Sledge

XX.X we’d possible spend Today much to time That in speaking like Phillip. what that you said, capabilities, effective of efficiencies would take with I with sheet our and the execution balance our quarter-over-quarter solid like activity I capital strong with attributes be are to strong in like financial to ProPetro’s XXXX utilization release developments, a press published first Along commentary. have highlight to with low financial was to and of to as structure proving environment. recent also more about a valuable for refer start fleets Thanks to time we performance. you to record track would as so had, yesterday quarter

an million March of capacity including $XXX.X under of revolving million, had As $XX.X had cash we of announced balance company’s of at XX, $XXX.X we credit facility, outstanding the and million which million as XXXX. available total of XX, XXXX $XXX liquidity yesterday, March

under was as revolving million, $XX As capacity was XXXX liquidity May ProPetro’s available $XX.X of May facility. Total XXXX, and million of $XXX.X million including XX, total was cash and total million. XX, of credit debt $XXX.X cash

our in will commitment disciplined Accordingly, activity, our expected projects current Although our to forecast, by given be customers’ with protect our borrowing allow activity us executing total also returns base our have XXXX will our we capital adversely positive $XX.X first decline be the in than impacted the structure. XXXX, in less of the for $XX million quarter. spent of full year vast The to million capital maintenance capex. capex to spending was on which will reduced majority expectations

the Our well continue capital historically XXXX. balance lean we proven of net of level remainder cash capital as beneficial as maintain working structure has to for as stable positive

Our and on advantages all efficient the and that the average XXXX. we In quarter three between these of favorably will chip position base our structure depressed these term, expect we in second outlined to of have we lean currently during effectively activity. utilized preserve crews customer times G&A us capital of liquidity and as blue four structure to near

contractual would idle our financial health to provide consist to intended. to like periods from during These times With activity fees to we back support stemming Natural unprecedented turn it will activity. revenue to that, of we in with Finally, of declines Phillip. as fees Resources critical that expect note of a I also term depressed intended supplement during compensatory near Pioneer portion significant our provisions of would like

Phillip Gobe

thanks. Sam, All right,

footprint outsourced; mid-March; previously in XX% functions over lower have to significantly support ways by date, to and As expendable negotiating talent our items, component cost expenditures and initiatives, our certain many previously materials maintaining the compensation we our have - all maintenance executives, already field-level saving pricing following: focus streamline our workforce directors. executed internalizing while core used to announced, have cost we operations, were and including operating that reducing our of consumables; on capital officers, continues we on reduced parts; team labor structure, large since and for and day-to-day replacement right-sizing reducing

financial but that have to our put a our swift cost look our to stability. competitive company position structure advantages undoubtedly to will the believe actions and ways We risking continue without maintain in streamline for decisive our

we activity core expect recovers medium term, and retention. retain over our As labor talent to of competency the

Our customers expect driven our to people in this the downturn continue that beyond outperformance activity. and in and past have we

half declining to March, in Now DuraStim Due of reevaluate fleet update for rapidly and operations. decided DuraStim management deployment the brief our a further to activity the on first oilfield second delay project. of

pumping equipment in working operating ample DuraStim by data individual various units continue will developed be conventional collect and forward allow to time company tested moving conditions. the alongside to However, to

Our to manufacturing run facilities. the the and manufacturing the along will units DuraStim larger at conditions environment test controlled continue and our also improve. testing more partners customers, equipment a DuraStim scale with to in market We, redeploy a when on intend fully

critical DuraStim our advancements. previously, must on remain team our we our feel times of strong a many role a continue can evolve and pressure said a pumping making belief to competitive we and in those to that industry that for hold customers play As scale, significantly global have many

In building near costs our field laser also ProPetro our relationships on on uniquely our solid right-sizing internally addition leveraging while term, to Basin, remains business cutting our culture. in protecting advantage the and customer home focused collaborative the Permian in

achievable pricing recovery. downturn. positive also seamless the of to of ProPetro both service lean are next performance project, the to safety foster are Efficiently our for flow cash technology which as expectations. innovation walls from way ways the on future necessary expectation our streamline current our is activity deploy in proactively business, retain a the its depressed of additional customers and pricing. activity remain chosen of With We such are near goals understand to delivering value our reduce or duplication XXXX improvement significant improvement, of are ensure and demand-driven own unmatched to times will term no to to and to on value We and quality seeking processes on capitalize to with based core best rebound execution and the this we during

survive best-in-class and over With and turn that on Lastly, efficiency to questions. that, during story ProPetro Kate? downturn to I’d remains beyond. like the this Operator will for it opportunities a capitalize

Operator

from from Go instructions] Our ahead. George is first question TPH Company. & [Operator O’Leary

George O’Leary

guys. Morning

Phillip Gobe

Morning George.

George O’Leary

end you the PXD Just to have guys nice contracts obviously any contracts with for Most contract teeth. curious or the don’t your idle a folks have. buffer in payments, and market on

if just embedded in you mechanism, upper there’s many there, any Just an how fleets to payments that. and the how work, there’s for, curious get cost if coverage it’s idle guys a margin then payments if bound

Sam Sledge

Thanks George, Sam. this is

get could have this violently, fewer to I have quickly. smooth to crews. think, so elsewhere want industry, those the we that but idle out to fleets given it particular information idle be low As some fees thought we appropriate outlined those that we place than eight imagined we would like quarter quarter, the and when to points that a and those value year. putting our when looking were activity have are into given work to, fine on don’t last and they this second and never into back sector these the the night, curves the for today we exactly released don’t Pioneer, one, were activity and working in our just volatility the time half we some crews play at of we you That where fees as outline so they eight in going contract committed in do eight pricing can and committed imagine, are into there There drop the of said, and how technicalities dollar necessarily was we the how second we was work, come

George O’Leary

$XX or are and sounds May, Okay, activity some $XX appear maybe a at some or to that half, it the everyone dialog any adding have rumblings in the there has disciplined deployment even WTI is front does may remaining but that oil actually has with me you’re been to crude players much there as that that suggests all oil rebound over fairly commentary be that’s expecting crude Is customers back levels, those at helpful. trough, this moved back. reached the hung outlook in the QX, right Then above prices? and has on capital mulling still not having

Sam Sledge

it’s believe I of a bit little both. Yes,

some the pick our our up for negative spots part, are been talks E&P fleets seeing as our second quarter our been--you get to yes, has disciplined, bright side. ability they talks also of are redeploy end as are quarter far more of talk initiating most with know, there with as activity well we in all, what but on seems first ready and customers. think that again it’s beginning All their since partners as the is as like I to remaining capital

Phillip Gobe

trough. go is the view George, optimism is going probably have a feel if My this it’s tooth a to Phillip. is at we’re We up It’s down. recovery. and soft go going this don’t to

it the on cost things pick activity, may be more not recovery, If activity. probably there’s not everyone against more be you kind a effective could but big but I profitable everything, activity downside, of caution weighing may read up it would

if it their extent, to go how activity work. of they’re picking up So be others’ pricing us, some of more you might ahead to see to equipment

As maintain positive flow we to we fleet plan level. at cash said, the

George O’Leary

Phillip. All very over. helpful, Thanks I’ll right, that’s it back guys. turn

Operator

question ahead. Go Our Sean is next from from Morgan. Meakim JP

Sean Meakim

you, Thank morning. good

Phillip Gobe

Morning Sean.

Sean Meakim

So versus that adjust are three fully the the many you crews fleet rate still talk active, profit per quarter. utilized exit to and how second able look once like the crews about four been structure? in what average, maybe can to you’ve your cost Could

Sam Sledge

Sean. question, is This Sam. Great

the second come where three exit be obviously pretty around quarter probably to a a the as entered any effectively we leaving point will fleet that utilized the quarter a There think certain sure at four But I the down more quarter, the if data seen we as the point. that remarks a the to in than going go. little say called with earlier the we active came than periods we’re of into of is number fleets quarter, in sharply the activity the is given will quarter scripted we snapshot necessarily useful we’re we’ve beginning in fleet are within obviously quarter. out time not bit, but lower working about far just quarter bounce

Sean Meakim

Then of currently? number fleets active

Sam Sledge

a much number number’s quote around Yes, weeks, to I bounced given active we’re think don’t the that last fleet just-- six we’re the today. an so in in place

Sean Meakim

there that Then is that. just the if of there. associated that the fleets, go costs half you the that on to into is back appreciate are that Curious are Could there? couple PXD maybe down those into the elaborate something it, work you going or in commentary last change to being a the because contractual more year. Is quarter? fleets noted any I embedded the points second expecting in quarter just on back clarifying Got third and there from number numbers, night you’re

Sam Sledge

activity, would the fees now. bridge that those operations I we’ve market said, That cost-free, to blows two our to the as fleet. in fees, volatility Pioneer to fleet given doing contact a are to to of we’re as the costs meant that given idle at of fleets just so The dampen that we’re not We what simply idle that from with in forward, just year. an with lockstep them close any time moving making balance Pioneer point basis being additional decisions we’ve internally us, kind the and of if not three reiterate given for chooses this standpoint and idle being to in guess, them any and we’re to we deployment terms we own they’ve today’s fit on plans of for previously, guide fleet right think their in necessarily another shrunk outlined of some a want of carry activity, of that’s ongoing our the would

Sean Meakim

it. Got

thank Okay, you.

Operator

Moll from ahead. from is Tommy Stephens. Go question next Our

Tommy Moll

for questions. Good taking my thanks morning, and

Phillip Gobe

Morning.

Tommy Moll

comment the think running Pioneer to? Sam, just you clarify regarding guys, mentioned effectively of that addition you’re four the as crews three in you how should or of guide to last it and may to you the made being PXD, for we utilized inclusive whatever impact

Sam Sledge

that’s morning, three count. that this our the quoted we to be number so No, would four inclusive, fleet total

Tommy Moll

upon to of that Thank are the DuraStim. the also deployment specifically Okay, status to market any all-electric tweak The wanted you’re macro configurations I’m the fleet decision is the certainly with fleet? Then those are there got what this it. still environment. when in an the refine, may first electric to to of recover modify you you. you configured it’s technology I understandable aspects for needing the doing follow to to fleet? run fully there, and to of guys and want when does What’s as go market curious,

Adam Muñoz

we’ll more then to on continue Yes have pressure and Especially attributes unit controlled the to Tommy, a pumping as itself adjustments both well environment, the software. of the the during Adam. this these times we when physical to make is

up worked the has so as pretty focusing as only redeploy is things the make the component stuff DuraStim the As now continue just we’re to times. leading to adjustments these to delivery pumper far the being it, it equipment on the able being on smaller flawlessly, to of the that able far right scale and small perfect and technology during the the transformers, as that electrical a to PDM, depressed much turbine, all pretty

Sam Sledge

it’s add Again, system things but your having I guess together. that, of deployed the us to allows if, Tommy, Sam. DuraStim electrical and tune learn benefits throughout answer are and fleet the we continued much by the on that at so data all I’ll into going DuraStim like lull one a getting we’re yes, if in was savings say, some that fine activity. ready I to the you’ve as entire pumps fleet, it to capitalize question forfeiting an by not fuel of to part pump of we’ve maybe is redeploy that that, you’re short conventional fleet not themselves, to to think when diesel this to optimize that entire gather continue together, doing

Phillip Gobe

through, this. from use out those incoming customers potential to customers. for things anxious work be but in understand deploy little DuraStim not scenario there’s proving the both of on They the technology types now still I’d customer very sense tolerance are like the equipment. times why this in add us for just it our to of There’s and makes queries to couple a

Tommy Moll

you it Thank gentlemen. I’ll turn Okay. back.

Operator

ahead. MacPherson is Our from from Go next Simmons. question Ian

Ian MacPherson

missed end QX the May. wanted from progression Did the that balance? did just if report end a you to clarify, quarter through that include from of this, I idle in I gentlemen. of payments cash the but already Pioneer the morning new good Thanks, positive sorry I’m

Darin Holderness

This is It not. did Darin.

Ian MacPherson

a clarifying for be Okay, few past much reducing better More going now so to future unbridled of so what than thanks You’re stacking and a will story much and normalized you in the in for workforce. preparing contraction much structurally, to years, manage do an back so the get side? quality better think for on points are be preserve next pain so ProPetro Where the normalized equipment labor of being need retrenching some to that that market, biggest do short anticipating towards growth your think and equipment challenges term to not and biggest are be you the to form able year, saddle that. you given the how the do with you today? the accustomed

Sam Sledge

Sam. This Great is question, Ian.

fairly has think the I to partners help to of execution continue an for to operation, are site. us in on that to I enabling execution. think extremely increasing it’s will we value be upstream. continue value-add easy, them us be say think focus at of is to can well remain If competitive. Efficiency the we it’s our and that simple. create our employees safety for any don’t but would continue our wellbeing we going efficiency our then through

industry-leading very very couple world. we’ll competitive. is in side we on keep on focus area I this will our this think premier Permian execution going We the be important, of focus is levels, can Density then the think resource we play with the our keep at and continued that and our if be to what on

Adam Muñoz

unprecedented workforce good downturn it be even Ian, Sam’s ramp able We’ve the times this be part time, we equipment confident our recruit able able the that also as through Adam. needed health remain retained employees certain and this in on comments, the are to To would say improve. strategies to implemented we to keep rotating this and is I back of to up call when add we that the in deploy needed. to equipment to back as

Ian MacPherson

fleets So across some we’ll working quite not parked? a see large simply estimates and life fleet, in expansion fleets entire some useful the

Adam Muñoz

Correct.

Ian MacPherson

gentlemen. you Thank

Sam Sledge

Ian. Thanks

Operator

Bianchi ahead. Go Our Cowen. is from Marc from next question

Marc Bianchi

not gross least discussion--or Thank you. idle fleet just context go like associated going and fees rest sounds or about profit. business overall you’re really of idle It to business? it idle I to discussion have that to Is the the can about wanted say now, quarter? gross at of back be second for in think the profit any to the the costs, quickly What payments. better, breakeven with maybe rest even those the of during it safe

Sam Sledge

I our the have, Sam. at think of intention operating fleets, operating have is the intention. don’t fleet of definitely gross below This That’s any levels. we level profit

Phillip Gobe

subsidy. a as it using not Yes,

Marc Bianchi

be looks Then there think as trend whatever there, announced as G&A and the that we Is like lower ongoing. here, ’XX, doing retained plans that suspect the towards a through Yes. about level, you think we what you’re a activity to a is costs activity should back ramps certain and level as some about up? quarterly Is how I you I think do that then there comes savings back? could see

Sam Sledge

that G&A. of - traditionally current in lean--operated come That’s components some do fleet. structure cost It’s our stacking savings made don’t within a up a other people we because is We’d very We’ve of will operated G&A not come great from there that our as, frac level. variable they with manner a at on as that. of are also note it’s but the which question be lean in quickly say, of savings, of G&A G&A how all far think we the very a lean fact,

working all know you we’re we So can those right and I quote don’t if now through number. a

what goal be I you below to think in saw would term our get it near QX.

Marc Bianchi

this that. think how for more position? Is ask to if tenure about a Phillip, permanent question just be thanks Okay, your the investors expected could in I for Maybe one should back things on role replacement perhaps for order, getting basis? you, a is a looking and wrapped of maybe for a more or up it then permanent in and filings the getting matter CEO

Phillip Gobe

lot planning, to me planning some the in make world, the don’t the and objective there’s probably any will is so up underway. The of I’m now, get age, these CEO not the it’s different, development operation guy and on thing next now. other myself the get current. youngest business serving to board right is different The honestly. go. most and think don’t main of right at going my any succession probably than guys I the I fine out obviously biggest is CEO of it than running to it view half and situation, have are any a person the step my role and point to of in succession CEO any sense ready for and

Marc Bianchi

turn Okay, thanks much. very I’ll back. it

Operator

Our is Syed from Capital. ahead. Go next AltaCorp question from Waqar

Waqar Syed

thank you. All right,

one question. and the Just incremental Pioneer to is that for The three revenues clarification in idle second you contract, would that’s correct? that going have the active the to crews half be quarter, a

Sam Sledge

correct. is That

Waqar Syed

good. Okay,

Secondly, do in for you have many are active a Permian the how view fleets industry? on currently the

Sam Sledge

been right somewhere now It’s in is the think Permian. under it’s fleets XX, just we’re recently, We probably--I think around shop view XX. XX probably our lower or but

Waqar Syed

tubing in currently your fleet many cementing and Then Okay. terms currently trucks, coil manned? of are how active or

Sam Sledge

line units This basically count. down operation, in is with our deployed Sam. we’ve rig seen Again, our cementing trend for

right that specific every that customers share of as our frac our a I fairly we’ve units, the that market operation quote We of have front know trended I We a if would me indication we of cementing To have concurrently number coil you with say protected has share our operation, now. there. tubing there. lot in don’t same

Waqar Syed

Sure.

or you and the maintain taking, that accounts it’s receivable. grow looking the there size to as something terms is to steps of shrink. of capacity are or bring could the [indiscernible] size linked your well. your revolver, That at Now Receivables revolver What of revolver? the the you’re in down

Darin Holderness

look potential options being at that of there, a at definitely right to right table with we is have the that help now somewhat about we a we could the are not move take options a out forward. the look that so as We’ll current, think current now but off sort There’s industry is lot all further standard. getting of revolver priority

Waqar Syed

right Are have so a there comfortable Is that? comments you million concerns size you’re or $XX on with, any and capacity of any but Okay, that available. now around that that? revolver

Darin Holderness

to say, balance you tied the it’s mean, I of receivables. as

Would to that activity but As an scenario would, have to the be capacity? our not will receivables. part I the afforded at unfortunate our It’s trends love current me downturn. in Yes, so down, of more just I the moment. may

Sam Sledge

Waqar-- And

Darin Holderness

[Indiscernible] cash so. cash, positive, net

Sam Sledge

Exactly.

Waqar Syed

Sure, yes.

Darin Holderness

lot [Indiscernible] there. unlike a peers our out of

Waqar Syed

Absolutely, you much. Thank yes. very

Operator

question of is from Bank America. ahead. from Our Go Mulvehill next Chase

Chase Mulvehill

Hey, four good from. Maybe got guess, on effective we between four get three to how maybe of guess wanted morning to four to utilized fleets conversation I just you’re think idled that? presentation think up back in said to split I your have revenue first you to you’ve think gets if utilized revenue fleets, you’re of talked or - everybody. effectively should to four think profitability the five you I think fully going you come that fleets I was to can the Pioneer, five, that the associated of I to the four rigs, for about five, revenue active about and adjusted of that? form fleets, positive I earlier guess that fleets guess call, idled effective going eight starting, then to to PXD, three their fleets, EBITDA fully will I XQ. for I idled Do five to with four the some million in the we about so profitability the eight $XX million etc. actually $XX e should remain to other Regarding those conference they think fleets? which how and Then

than million it revenues that PXD more just some $XX would I If so you add portion said significant that be with $XX think the to if context contract, to million, associated are would of can. you

Sam Sledge

not the today, I crew capex we stay fees expect that flow. know, Chase, my calculating best parts think like just get are intricacies us shot necessarily--details in to outlined necessarily the level, I’ll be we This are--like I one to at are we, get so There said given of few that in fleets is line take idle how time. second for that maintenance a don’t minus lot it. EBITDA we straight so our fees the confidential idle of simple into in would we’re Sam. nature that our cash contract. a more unit EBITDA one, working positive--you number. to a care at There’s cash crew-level earlier, the The we involved it’s of would quarter, earlier, that positive With that that That’s don��t

we you’re No, the out in some the necessarily. parts think data of of amount pinpoint as those that. quarter the some those savings were looking of for Can exactly movements. quarter numbers operation through moving significant outcomes come with second and we familiar we’re kind our cost There the now? a of where gathering pretty will first right part I shrunk and sought that still not of

we the see we’re some dust that positive little level. As on not bit, areas and to flow fleet it’s some strategy settled just detail a into how of data here, that is, answer at cash keep more positive but get EBITDA to June of the indicative sure to hard give has those as helpful I’m now. right hoping necessarily

Chase Mulvehill

that’s more the portion we recent to in to you PXD’s million revenues, that presentation? be than that? significant I Can Okay. talk assume to that of disclosed $XX has most million Can have $XX your it

Sam Sledge

we don’t position X-K their that our will numbers in that think releases from I of a to idle we’re or quarter. disclosed Well, the we our be exactly Pioneer range a if information. outlined they’ve what fees in revenue second filed we speak in in know to yesterday

Darin Holderness

put time, a put Chase, so. that and out The There’s Darin. between environment when changes, they is This this when period we out. of

Chase Mulvehill

to if I how just you ask we go wanted or electric an there’s one-turbine come are anything. still follow-up, when the I specifically use Are potentially about DuraStim with to this, turbines over sizes. using the want and quick I your you or about aftermarket you you know to One some larger turbines, fleet time. to expect about you looking smaller maybe configuration evolve into back Understood. that you think fleets? guys if electric to going turbine can decided guess smaller to option talk

Phillip Gobe

does Right customer power? right - ProPetro that, does power, provide third a turbines. party on provide the we’ve questions open does There’s now, the got power, the provide our two the

been control has up in There our emissions the turbines, flawless, are that that terms gas of extremely them be. it’s cost would some like the performed probably last be and would on not desire think when down turbine I on well. we know I availability. be call Unfortunately is--the don’t technology, could you’re and mentioned where greenhouse to what cycling

us durapack, see in the the different DuraStim a turbine, of a we’ll reset generation source, and than with pumps a pumps You’ll field more single and run evaluate a that. obviously is which power

question to size emissions on good of a questions looks gas. of the think greenhouse so as broader open it’s turbine, number believe. it I I pretty there, profile out a than relates There’s that

Sam Sledge

Chase, bit. Sam. to little just add I’ll that this is a

look generation, think above we’ve could it conventional that we turbines, and previously term. approach small I well it uniform in customers are said in near what before the but be that electric tools won’t interested the fleet. deploy - today it It more probably different very that big of on know, a electric see turbines, technology, we well execute future, to of various in you probably needs very at all to our offering the every be could the as is be we our

Chase Mulvehill

appreciate right, color. the all I’ll turn All over. back it

Operator

is Our next from Go Scott Gruber ahead. question from Citigroup.

Scott Gruber

morning. good Yes,

Phillip Gobe

Morning.

Scott Gruber

Sorry capex earlier, think if maintenance low the for per-fleet answered how remainder we but basis you the year? of goes should a on this

Sam Sledge

$X that per Historically, million crew. we’ve quoted annualized number around

to but guide of strategies all life very today, we’re mentioned calendar rotating capex our quoted towards half the than year. Adam basis that that, less conference I working I a think of million be down, we $X extending hard trending on that as call, drive we change number maybe the in various this would don’t annualized through an our of back of equipment. on our last equipment, necessarily would think earlier, maintenance

we’re savings next I had to of our to think couple term, on that going is there near to and be hope there some there. the over update initiatives you guys working and keep quarters

Scott Gruber

fully $X other million Sam? components so, or include doesn’t that And that That borrowing loaded? off pumps, of is

Sam Sledge

be cannibalize on resort of near a around number to going more allow No, equipment option. It’s location we don’t last That equipment have fleet average would to the any any now. increasing down. size that’s term drive and the us rotation plans to that right

Scott Gruber

a to up, is breakeven starts something just it’s costs? price eventually and activity question When overhead breakeven, bump couple if Then on when price guys, is demand growth guys sacrificing with for up restart there Do be years, willing everybody. like a because starts profitable you on going where a upwards But a comment It become at. pressure if some resume? when cover burning at level, above and about the on and early you work, challenge industry the utilization work low, cash corporate you just well. that you’re reducing to end to a more just a the pretty for there’s as cash imagine to do big capex for be given cash seems activity demanding back think would utilization working fleets maintenance you’re in which to could to corporate probably While you. be even capex, maintenance you just are you I it’s putting share was to on not Got position where couple corporate obvious, there you movement bump is quarters? at could price be so a is pick satisfied no

you So I the end is price on, guess in bump little early if question, a early share innings a even you for up of recovery, demand while? the sacrificing would

Sam Sledge

take shot I’ll at Sam. is this Scott, a that.

answer I short it is depends. think the

we and higher to help as winning out more street with that working sector extent well transparency with move and active for to customer produce everybody in alongside We basically think, so history be collaborate redeploy five and continue to customers said, shown having these some around be them efficiencies as pick have flexible and of I grind and more extremely need base be is redeploy excess very to of to up. of XXXX, time, that think well customers of two-way dedicated We market the instances luxury and needs, years, we’ve services we’ve That Coming the pricing willing with these some think would a to to back great to our we worked for ability our good pretty customers. more with. showed quite a activity equipment rates a our customers of Does relationships were pricing that I together, we we’re our higher that some as helpful, where yes. to begins much as be we with we that’s in value can. possible more their our service apt have going profitable? going equipment a to to to the we’ll all more think as agree customers we

Phillip Gobe

have in Yes, term, think get to story. you’re I has different Near to and equipment pricing in time. over the your your to you a long a a term get because services going on to reinvest point return where is investment,

pick operations. on beyond themselves work in and they’re got We quick observation that for breakeven flow the but get too Just near good negative at covering efficient create a bigger for equipment, is it when only don’t to my the margins problems up, the poorer plan path, we - is it’s to back goal us, fleet cash road industry take the level problems service big less go down to term corporate. at to and

sometime continue return a equipment your get invest. to on to to got You’ve

Scott Gruber

be utilization the low to Good the the hit you at levels, think guys. industry to you to needs demanding returns. on the color. head I - luck even better Appreciate disciplined, nail start

Phillip Gobe

Thanks.

Operator

question from ahead. next Vaibhav Our Go is Vaishnav from Scotiabank.

Vaibhav Vaishnav

capex, be to versus about that of XX fleets, working about wanted about and XX be million thinking in know second remaining think is could nine it understand it half, million eight quarter to maintenance If maintenance implies fleets, the of second this XX three four working? fleet. million so implication the Hey to we to guys, and you’re I could fleets to capex $XX $X $X for months math morning. capex of I good think the maintenance

Sam Sledge

don’t know a fleet position numbers. to terms of detail if I in into additional count any get we’re Vaibhav, in

look very or our the the into as we downside. some the we rest seems term just near we of and to that. But appropriate year change the maybe baked number, As quickly slight have, things capex for just an that that conservatism like can at with know, at activity the look upside expectations

we’ll that a you I be in this get will on think for additional that quarters the remainder number to the year. we continue year, as of updates report

Vaibhav Vaishnav

idle The they in your maintenance guidance? Understandable. have fleets, any associated or do capex embedded

Sam Sledge

no. things Not any or for those fees significant warm of be but extent, not idle keeping portion. significant ready, what used could stacking be equipment could any Part to

Operator

Our Suisse. next Lundberg is from ahead. question Credit Jacob from Go

Jacob Lundberg

to guys the it you capital you any obviously like in cyclicality your be other have this. that might thinking downtimes reduce Pioneer, the think the able Just base about you do with there the widespread in structure protect ability helps make mechanisms business, through business? more invested How about contract of to you contract cash are or use some your structure flow to that

Sam Sledge

Jake. is again. This question, Sam Great

like blue and sector customers, that. we Our just to a undoubtedly needs partnering provide trying efficient that very operations consistency, Pioneer. little having with been more We’ve chip and know through consistency

to we purchased more sure We’re on going but to opportunities them a that in be get there one like the given there’s there are. that Yes, trying this? here. the would as out small What there, we’re Yes, will it another with just like set the just contracts possibly up Would and we we’ve go opportunity assets figure think that opportunities, Pioneer had don’t the contract, that contractual one I this be think not like look but we if good like with exist. more that we like, from executed amount are hard to we of out necessarily Pioneer, given future?

Jacob Lundberg

past. but conversations any not you’ve those Pioneer, but some you’ve sort of had in that, more just would current Okay, deliver about up curious stability you’ve you and exactly in the what appetite had characterize environment in contract a have structure of little more that difficult, sort and any--maybe with in of it’s your just if the some with follow a a--maybe you’d had any how conversations to on if customers business,

Sam Sledge

the mean, really socialized past, and our focused customers. internal we’re we’re this right of right now at and environment there as is but and in it’s activity certain opportunities points that, customers could our on more not our taking right certain now. imagine. you Like hoping that think time, I maybe been for there’s in operation now, an just idea have team do been I care said, with that any I In

Jacob Lundberg

just about you year, outlook just could wondering and how levels we Then how Understood. the for low that activity? of to of operating on the trended QX, was and think in should second efficiencies touch on if half quarter very XQ relative at I QX,

Sam Sledge

metrics, in QX you look comparable off us, to record and if most efficiencies charts Yes, in kind quarter important up metrics. operating just numbers the was ways. for operating up the to flat of the slightly some many of of QX certain the at internal were again, an setting

was do on QX the that out of that me quarter-over-quarter to personally yet Everything one direction right ProPetro-specific continues there. think to how the trend downtime equipment to with QX mostly stuck downtime in to downtime. kind we much again, I cut kind back of

Jacob Lundberg

just system inefficiencies level how second might Any on half, commentary look QX low and think some of the that thinking you the come that could activity? about maybe through in just the given

Adam Muñoz

Yes Adam. Jacob, extremely this mentioned. high, efficiencies is far Yes, like Sam have so remained

and the of of the up at those additional times times. as equipment periods mentioned, access, day that even that low these rotating there rotated. in the Sam availability been like just downtime, out high during running to those is through additional that’s helped But the as us equipment being less as aspect, of tough we able to on on these remain performing the personnel, there location in and what’s equipment as because far way the have far we’re that the have, the we more there locations field put guys efficiencies have level a kind out access and think the remaining activity can for to make to longer it, I are sure

Jacob Lundberg

commentary. the appreciate I right, guys. Thanks All

Operator

Our Wolfe from Research. Go is Blake next Gendron question from ahead.

Blake Gendron

fleets, to I ability somewhere states it think Thanks, mean wondering--you here just dead to go conceivable Theoretically payments lot of good the I’m Pioneer want a those and contingent know, the are morning. idling your Don’t fleets that Is beat there on on horse and in opportunities. first, other you’d non-Pioneer market category. fleets that it the market out a to fleets are for unutilized two to at that after one that, fewer moving runs and forward, to eight those than back customers. can Pioneer that come maybe next and you’re and spreads remove year bring and able of year agreement, those least market back the agreement? other those or or spreads into from then Pioneer the those Does is assets there that recourse the any that spreads spreads

Sam Sledge

best excess eight to and Blake, We’ll to that fees duration fleets the to agreement with their is the mitigate the answer the exist agreement. to of the short Pioneer plans in term the that our that specific checkpoints do simply any equipment, in the the on deploy work future.

Blake Gendron

not the segment any Got that’s on you. of those strategic in but question, structurally segment, other would in EBITDA. it’s been to of touched have lines in Then down it another land in be or U.S. you oversupplied, been auxiliary for services service a outlook wondering, asked may wind now are the generating these challenged capacity. some I’m whether that just you terms

Sam Sledge

as things of of frac in Technically as those in quite efficiency demand our reason overhead services division value our make and are a we there provides able associated tubing other little possibly well, there’s I earlier, a that then that that lockstep but said think in the overlap tubing crews. to future? bit been but operate coil most Possibly, just tubing positive using still are at there’s we costs in Could our we and the housed. get to noise at our as in Like division manner. between profitable in has level, corporate operations. is the terms customers’ times our at long we not and that we’re a multiple main part recent the coil segment. due will past, packaging is in with also but decent customer a said with segment where return We operation segment together, to coil this level because gets We’ve totally continue we that’s so to drawn tubing, coil negative are frac revenue that in The why base. our coil operations the

Blake Gendron

through the I’m is sheet keep your sheet balance building worst what the it on down debt wondering the if moving just amount going fair. here balance That’s absolute on the target forward. downturn. for preference you of seems and versus to be positive a like more, paying you’re cash to debt, One totally of cash have

Darin Holderness

Darin. is This

our Just us down within guidelines I following that to think further debt borrowing agreement. revolver bounds down, our see how monthly will of stay of as the that, base I is our re-determined need stay you paying the to works, so and within goes

Blake Gendron

it, Got thanks.

Operator

Partners. John Go from is question next Daniel ahead. from Energy Our Daniel

John Daniel

by your year, the thanks activity give going the on off for the what fleets at but in the me year-end, guesstimate Obviously guys, you’re you’ll for where or fitting end Sam, would guess XX quarter? in. not seeing, be fourth today. somewhere you the guidance in running basin to of mentioned be of basin’s you’re count quoting the of fleet based your Hey

Sam Sledge

shop right Great question, John. a on we have I’m not now. view that sure

higher just Our focus is it is a than little bit more near than term that. We today. hope it’s

John Daniel

enough, calls inbound the were - last customers would how quotes the How about completely from Fair you this in week collapsing? versus getting two you of okay. characterize was where oil level when or

Sam Sledge

were been along, we reasons different quotes oil we Well, them thought was collapsing are what today. giving giving all than and completely I time we’ve for that when we were at think

so but different. customer relationship customers don’t with of a conversations working quite contact in our them we’ve dedicated had frequency base, As of you close as pretty stay know, think the we I is the different are much most our long with

John Daniel

two know optimal I very to management fleets it’s what’s right. want hard are size market there. to company recovers? right better XX-plus on once but thought, your I’ve XX-fleet ProPetro? now, for being you got to All Do crisis a asked, piggyback Ian quick a picture when that. sit off as XX the a the or back try thoughts you you question. to get back Just team, just strategically, I you’re to a I big good more Okay. ones. think in as

Sam Sledge

question. Great

and size having those productivity, things. an of downtime a all and little we the efficiencies I system more to a larger average that think justify from fleet standpoint through bit able terms in slack in equipment are

continue how is ever to right capacity, that be to We we’re or total ever equipment say to the again balance amount at to looking mid-XXs for it in that. maximize look our much of need will mid-XXs Hard location it efficiencies. be on terms would in of terms to but that in operational of put equipment that would the the in again

John Daniel

equipment available it opposed more probably it you’re location so of like doing as on Okay, lot sounds a the equipment? because there’s to just is permanent, now

Adam Muñoz

the can I for ramp up said, just we the--or made to Adam. equipment. perform our next extend pace the is to I is or always this but motto it as we as in the we like as life I here added. at had John, base add. good decline forward, add performance level any sure that say say what but where a doing a chip as at we would to part as wouldn’t definitely like we’d to we’ll blue do on customer high going the it’s activity done, that and a activity we good the pace dictate now that that we’ve them we’ve permanent, add is when We internally it here is that is we’ve as we just big we’ve calendar that so definitely always, last ensure level have measures of do crews, a where want we’re fleet we’ve at increase levels, don’t to safety always lean be, last need each same of that we

Operator

turn our to closing like concludes call to would for Phillip This question and back answer remarks. I session. Gobe the

Phillip Gobe

for a out. you, everyone just close this and I’d Thank points important to before thank like reiterate few us joining we morning.

First, This pressure business. pumping of maintain evidenced years expect have the we excellence, to this forward. many is people in truly execution believe we by going that the competitive advantage best we and

strong maintain cash expect to to an Second, and our we asset it recovers. be activity net position when expect

will service. than ever continue in near our to intensely Third, differentiate at well have the this more focus execution and site, believe we on term the will we we even

some and Thanks be joining economics for energy customer will Thank Finally, holds foundational the catch acreage best blue you. in next for us, the the a we’ll quarter. our base industry chip of again difference us. on continue up to and that upstream

Operator

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

now disconnect. may You

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