PUMP - Earnings call transcript Q1 2024

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Operator

Good day, and welcome to the ProPetro Holding Corp.

First Quarter 2024 Conference Call. Please note, this event is being recorded. I would now like to turn the call over to Matt Augustine, Director of Corporate Development and Investor Relations for ProPetro Holding Corp. Please go ahead.

Matt Augustine

morning. good and you, Thank We appreciate today's participation in call. your Executive Sledge, President Chief me Chief today Officer, Sam Chief is Munoz. and With Financial Officer, David Officer, Adam Operating and Thorlemer; for morning, the This our released earnings first of XXXX. we quarter results make Litigation Please today's projections Reform future are Act. call for by covered on forward-looking note expectations comments statements our the regarding any events that we or Private Securities

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

session. we Finally, I after Sam. remarks, to prepared to would our a will With the over like that, turn call question-and-answer hold

Sam Sledge

good morning, everyone. and Matt, Thanks,

quarter exciting the for ProPetro. start XXXX an First year to was of

walks important David highlights. through Before like results, business covering by our to begin I'd you some financial

are report to we those year, actions will this As quarter, we that strong that with on our off yielding year, build investments and returns. we're to last strategy to our actions, we and is continue expect pleased start mentioned To strategic working. demonstrate the initiated progress, recent recent coupled

walk through the Let's of some specifics.

ongoing assets. First, fleet from next-generation strategy to underpinning transition our is legacy our equipment

performance. future. technologies have to services. needs And of the our things have particularly to significantly next-generation with services fleet like equipment today premium electric to our gas we industry, of solid for remains emissions recapitalize $X industry-leading fleet and in fleet, X a meet assets are and outlook substitution. X/X come. our bright. last and returns We've the lowering majority years transitioned and and next-generation state-of-the-art to billion approximately continues modernized both we for support of our demand fleet years, to create customers, evolving XXXX delivering we excited our to for invested equipment, our the for value our Today, over natural Over strong into while Having the through Strong worked an realize to upgraded

uniquely with now Our electric We have Force X offering blue fleets deploying create the displacement. electric and quarter with DGB fourth customers. of fleet industry-leading the to for diesel is three value Tier X our the X fleets operating deployed end second fuel by positioned

fleets, last in a operationally we at electric deployed levels and September performing which force early of first Our built reputation year, financially. high have of

we're is and with of ExxonMobil. the X of pumpdown through provide wireline testament with our is field. pursuit is direct of our success by an delivery walk X-year electric Silvertip's the this announce latest to to our our agreement Force significant agreement strategy possible the services, power for with underscore ExxonMobil. paired electric fracturing we our services a like ProPetro. achievement contract of the result force and industrialized coupled in some to to execution is The for pub were moment a customers our with hydraulic wireline a to calls and to of supported operating team of to offering This agreement Permian, model As in first-class the value here create ExxonMobil force to such week for and a services our I'd premium earlier fleets, a take why in highlights proud glimpse supermajor. and important This showcasing agreement made step a will our more logistics global to a of durable is to look by and ProPetro This agreement customers, achievement the along and leader XXXX. and higher this our customers, partner what and with is significant the of commence ProPetro. multiple a with operations year equipment of electric industry us, We with option of trusted a a ability recognized half in customers. creating agreement, integrated deliver here third flexible efficient first for tied early utilization, completion inclusive made ProPetro reducing to proud faster, for to fleet into like, while future the our an team demonstrates possible This as our a operation cost earnings ExxonMobil successfully widely at our closely work risk force other more transparency, services efficiencies The also contracted a our deliver services through to profile. to in all

electric is equipment attribute earnings diesel to overall the minimizes transition to contracts continue fleet a over demand, inorganic equipment of X transition our cost, our manner to approach we want and high to strategy, Tier covered garnering force our and in that equipment our in I Our plan that electric capital term. time derisk committed force growth. Having our core to move performance over our long disciplined developments, another recent to

M&A deployment resilient results. of and improved supports capital value-enhancing successful record Our track our

continue strong of to our which power of acquisition our and on continues recent impact already show to from The value our earnings acquisition, This tailwind synergies acquisition and beginning momentum expected a earnings our pursue Five be We results. free are cash for Cementing. Silvertip accretive in that our accretive flow. Par revenue to acquisitions like builds

resilient is remain valuations make of opportunistic shareholders. will final returning of flow, cash M&A element strategy The at philosophy. that allocation key in our focus cash in With sense. strategic by our to We capital stay opportunistic capital allocation pursuit our we opportunities our accretive strong free supported

an a inception repurchased we approved ProPetro additional last of program XXXX, an repurchase million. our stock. May our that XXXX, our XX, for May Since outstanding plan $XXX Just with and approximately share Board through X% last in common the our million increase has of extension $XXX authorized week, announced of of total

free ProPetro's this Board's program, confirms cash generation. in increase recent flow share We repurchase and have and consistently confidence executed on growth earnings the our continued

results. our recent the an to shows power. off in investments success XXXX to with we've that also made our the earnings and Now the We of strategy quarter started enhance execution our our impressive turning field,

Our operating differentiated base, and density blue our our Basin and Permian resilient. make operational excellence, supports strong in the chip customer offering next-generation that company equipment

year, term. confident reduce that financial flow to and approach excited remain continue XXXX will as us. CapEx cash deliver large allocation this now This are we our durable our support capital spending requirements and can free We We results the long ability in capital reinvestment very in beyond. for behind repeatable are and our to

Despite confirms mindset our approach extends offers stability. being with bifurcation we and are upstream and capital M&A macro our pursuing. recent the Turning outlook. to strategy creates differentiated the a disciplined now market volatility, to of the The Perpetual goal highly needs earnings capital the consolidating we're strong through the share power To serve free can returning that opportunities provider our generating E&P to cash flow while plan. and enhance service M&A summarize, accretive of space. to evaluate our continue sophisticated repurchase to shareholders market

Our gives fleet our potential a proven earnings see discipline confidence and bifurcated during growth as we us transformed and slow what strategy environment. no in to

drive to to David? and space results. to to financial with more it We like ProPetro I'd discuss industrialized are years David come. confident that model will over turn success now for benefit first the continue our our quarter to

David Schorlemer

good Thanks, morning, everyone. Sam, and

the variety we our our quarter in strategic was priorities to of to certain the mentioned, our a requiring me our last initiatives. great in and been some Sam first have progress news regarding ProPetro's and testament of financial a merits financial few objectives of discuss employment effort progress in an has and years. performance today strategy over strategic let clear, and As operational significant achieving performance And this the be active resources.

being implement performance and and our superior and The new All work new are combining only now asked business these with processes ProPetro's and realized. because diligence utilize new this innovative of ProPetro, the technologies. to and of we've possible of resources teamwork unmistakable whom people less more do are beginning be results field to their of in at

revenues the We having to capital we are producing healthy in now to million $X with million, possible fourth to million and spending $X free approach, XX% as margins. dedicated lower expense operating fleet enhancing related invested market adding also cash $XXX billion a offerings good a to the and $XX quarter, to first quarter incremental the increased incurred adjusted lower of Despite to recapitalize increased $X increased support loss and more million is our our customers last electric few in over operating our million strong our in service transitioning the compared to are EBITDA to fleets reinitiated the paradigm. our company higher of fleets. from a industrialized more $XX believe In sustainable XX% is headwinds, first quarter recent Notably, quarter to XX% returns capital quarter. after for and we flows. what prior as sequentially indicator Due requirements. Net income net the lease in years our to intensity results

We also our of the from another million. quarter improvement largely cash performance quarter achieved free in $XX levels strong financial rebounding of to significant The fourth attributable activity flow was seasonality.

our demand on where to that as they expected pick the activity dedicated left were differentiated saw to we for speaks transpired. we discussed services season. following holiday As call, our the customers fleet their after strong prior up and restore This year-end off, customers

provided. end Our which the XX.X was top the first effective range quarter guidance fleet fleets, we for utilization at frac was the of

a guidance range we Our with X signed XX quarter force for deploy cash second ExxonMobil frac fleets of electric remained active to liquidity have as fourth year this our is are XX today, June expected fleet to strong. XX in recently contract. and utilization and ProPetro's of position fleets of part XXXX of which fleets, effective the

XX, Total the ABL $XX XXXX, credit the cash credit $XXX million the quarter was $XXX million, were including and ABL million, facility. facility under of $XX the under available at capacity was our March of million. As cash and of borrowings liquidity end total

our capital expenditures $XX million. the for Moving program, were to quarter fourth capital incurred

spending the we optimization our few realization of to flow continues have generation. demonstrated our to the continuing due and benefits for transition is last decrease cash quarters, from free enhance capital fleet This lower As program. our

operations team, doing capital before, chain results. our scrutinizing than we're maximize driving assessments and are is supply returns our the our to favorable conducting relationships. work spend so also Additionally, ever The chain more they're vendor along supply from with

range million. the our progress, of guidance incurred our Given CapEx end to lower $XXX to to our of previous million now be $XXX expect we biased XXXX

As we cash durable a more we resulting further free capital decline force with flow particularly our with electric the transform anticipate in with associated a profitability, spending maintenance increased fleet fleets, and validation multiyear contractual of the strategy anticipate In we remainder further coverage increasing business. across investments our of our and earnings the our of enhancement a in from resulting the fleets. our demonstration XXXX,

the of to we plan in now our inception us shareholders. X% of remain million of program, the our intrinsic We current shareholders, the financial profile shares, return of opportunity. relative price repurchase equates million is Since capital the a enabling confident in strong we X as to shares investment very active approximately to significant which the inception XXXX, view remain share to retired May our to creates compelling value Our have discount program. $XX share and of that of outstanding returning approximately

We program to share repurchase are long million will disciplined by remains the allocation repurchases term. opportunistically continue dynamic I'd committed $XXX Board. the under executing for by increased we capital to sheet shareholder and that like ProPetro's our accelerate recently to returns balance reiterate authorized also and and strong, extended

years. the showcased Our continuation results recent realized improvement over strong the of

us free our performance executing cash enabled Additionally, foundation discipline install long-term earnings while -- and and to stream. agreement capital develop further our M&A strong our industrialize capital flow accelerate to our capital-light accretive capital lease and

activity than are of to no-growth a Finally, environment. we to our as consolidated industry, in outlined Sam ever in and before. before reiterate large representing customer the we which spending mentioned, base in Permian more their disciplined The producers hydrocarbon slow is our industry we are believe have view the and

experience strategy this leading designed this built ProPetro needs a commercial environment. the has We've is for is operators regard. Our in architecture of unique meeting in that also industry. the

our efficiencies. innovative and technology solutions, our technology organization electric-powered our to also are delivering maximize throughout fleets force including We leveraging

call evidence Our progress for are ProPetro we delivering our make financially, further only also of for not our beginning our by commercial I'll The show but industrial to and operationally but this and it Sam. is results, ProPetro, the the the strategy clear programs. best back continue delivering benefits future. company to their completions customers With that not for strategy will key as building in shareholders solutions also and confident deliver to customers very to that, turn we is only

Sam Sledge

David. Thanks,

in driving attributes Before turning industry. like we're that to summarize the and our and our again, confident are why strategy Q&A, the of future I'd our company to, key success of our

on Despite We us, in the thesis, focused on With ProPetro investment strong quarter that strategic performance one a first recent our compelling capital and remain provides our decline believe initiatives. executing spending slow behind we flow highlight. the we potential. uniquely energy headwinds the free cash environment and positioned have growth are our started space, showcase services to and to the to no earnings in power

our that pleased year start demonstrate started these are results We to the capabilities. have to

successful been healthy buying accretive back and showing all executing on simultaneously we shares balance a our while through, have pursuing to fleet, very continue. sheet liquidity and We acquisitions, are and profile. returns Strong now in transforming expect that maintaining our

demand in We the the positioned here ExxonMobil as fleet Permian you we hearing this the contract, space, Despite strong our of our current This Basin. more for the like well to is ongoing remains across future recent OFS in our is force are opportunities expect evolution in that outpaces confident supply. be advantage our ProPetro and demand services. evident take what may industry

customer and spot are from addition, with Permian, operational the in density insulated market. in and In our the outstanding portfolio Permian the the outside here of we uncertainties

which look face. important remain ProPetro. E&P consolidating our is believe that the combine industry. with the the will primed industrial given deployment we need next-generation backdrop demonstrates capitalize of We of we top-notch is ahead, the integration strategy on our ProPetro This to continued technologies, the on evolution consolidation As the plan focus at of here of supportive execution directly to service market

and our remaining share on we for operations fleet, the long strengthened while transition opportunistic As our significantly have M&A we business continue buybacks, term. the optimize to and

a the the earnings goal. business strategy consolidators in we're that to future service and Our of our employed goal E&P be derisk the We of model. our we've on provider support for industrialized to to is choice the the space, continues and well achieving believe more way

contracts proven while electric costs committed capital that value-enhancing these sharing technology assets. We have is garnering for

which forward sheet to We to to continue a shareholder with while look opportunities profile, to the we on liquidity ahead. run. drive to execute significant healthy the long maintaining clean accelerate a opportunity over balance returns We continuing tremendous expect capitalize

as to the I'm our of dedication all of site team is is none of that we strategy which open Basin. right leadership's always to the for strengthens Permian without confidence lead possible improve. like I'd be to shop Thank we Operator? the teammates a in outstanding and your to continue well continued performance, office. With that, the in this the from ProPetro you Lastly, part the it questions. proud and our of now that have at ProPetro to the up striving competing for

Operator

now begin from question Sandler. with comes first Piper question-and-answer will session. Instructions]. Lemoine the Today's [Operator We Luke

Luke Lemoine

XX% far working. were fleet, you're now I But the versus as Force as to still be diesel. about Good just kind right first cost of of I contracts, morning. just talk savings? these to supposed of kind innings what some it's wanted the know could of on seeing The in early more. you cost all, [Indiscernible] the savings here touch X to operating Tier XX%

Sam Sledge

Sure.

of I than you probably in very short have any we but indications detail number early an XX% we'll think exact XX% positive. pinning very, that have, are stop number already to more

in Before the we little more some years those that's field a equipment. true is time solution on we'd tried have been and get granular numbers, like this more on years. But of out run and a the to for bit

initially our this confidence into with contract field demand with pull to we're week this as and what -- the see, of our with here can announcements So continue kind to earlier seeing customers' via ExxonMobil. and you equipment

as it's better than or I expected. think good

Luke Lemoine

the talk then the think fully about additional And fleet overall of for this budget fleets? built line kind I possibly time year. X your fuel. force fleet you see in to dual you just then the how outlook Could CapEx on in electric have maybe And Okay. you progressing your

Sam Sledge

remarks a we That's last million that's correct or materials million But for could but that option we in in that $XXX exercises today fifth that Thanks a to. fifth look fleet. and on Inside XXXX, had fleet Exxon at did quarter, talk it sure range, we demand, any the for X%. for their quarter. not fleet. sit be that we $XXX scripted Yes. of we as could likely about I'm if to lease calling one out. That fit here third this

X were for sit exists technically than were push other on demand So number that as for contracted higher multiple we X today. X%. There's conversations here going would that

the and that build these kind -- of the we effective mass of more can the and a So record operating track we fleets. easier market of we an the more build, more more

that of us direction our type And about this thesis of that technology the future different deploying really quite excited lot of momentum contracts in we're really, be for positive equipment -- are about a bring it the company. types that sector, the will just that in the of stability excited in making sector of it's has all in past. like and overall should So these really this than investment our been to past has a bit the the

David Schorlemer

Yes. David. is Look, this

that. a add to little Just to bit

I But we've to X kind out be look of of fleets think also between built year. would term availability there. to at power that the in what mindful long have we we X per is

we're some we're going that limiting some are there. -- the are customer limiting factors. uptake to with the things and seems very good those pace So And be that compatible

pace think on I good a right now. So we're

Operator

Barclays. question Podhaizer next The with comes from Derek

Derek Podhaizer

maybe of previous I you've on to learnings some contract. the that the wanted contract your expand Exxon Pioneer and just from had

some it. challenges up you you XXXX, get that this to on Exxon the as up. was how rework contract the versus how had had to thoughts Pioneer wanted in went current your industry contract Just obviously approach Is set

been through on overall approach the you've thoughts this one in your it you past. just knowing how So

Sam Sledge

one mean good we're some to term space with good. single first I'll dating industry customer not really than COVID, our only of in learnings, us this that apply Lots so able we quite what those mentioned, months started plan -- contract much only experiences into There process with equipment. we that experience period the contracts, of confidently That We'd maybe we Pioneer doing you that. through into learnings of else ones a others. sprinkled more this. long our the have for of that through we're to -- disruptive ago, the here Exxon out to even the them say with of a thing the over having we not time XXXX experiences There's back I were things to Yes. force set most are with contracting we're not few does first the that this navigated contracting this ExxonMobil equipment longer the coming like time. is already of but said, of and came X into almost built with to tons experience via doing work with believe do so more But the that anyone X communicate agreements electric because amount of in

we a was So of quite And honestly, be able do were to able contract. that. to with talk it experiences through to previous our lot invaluable that

first rely trying our and And solve I we're that doing contracts this. they're of a usually -- on more to wouldn't most doing the putting customer-by-customer Another I'll have are a to of a this that competitors kind about that's of for any cookie-cutter that it's and have sensitive say the commercial really to. approach what customer might We we different. on no, say hear one these same. thing bit We exactly basis, flexibility how is

this greatly our agility, of the as this is getting us field equipment say well. into So we and offering feel I'd in benefiting commercial kind like

Derek Podhaizer

Great. good That's very color. helpful and

Obviously, coming stepped expenses additional to going have this of lease now your Are at should think about be those you the level you're that margins. XX% indicate incrementals. How the diluted about as to talked you margin of new will the You the quarter reset up ProPetro power earnings a environment. in results forward? interplay in your the industrialized when going expectations expectations we we the

So the a margin step-up maybe on around profile some just see the outlook we thoughts did this quarter. significant since

Sam Sledge

dynamically. QX, think, yourself the David might these outlined comments. of you margins, how a -- kind like But EBITDA takes this incrementals But puts of cash some maybe into and to is electric other Overall, very also things seasonality of and margin that equipment all deploying work add talking and we're about I'll market, Yes. detail could be free want margin like on flow a can we assets way. like coming cash possibly the the allocate off a deploying opportunistic that incremental it's positive. about can system important high to cash-on-cash I back in the our stay flow Derek, M&A do more capital making tailwind about from change to into from something free producing buy an -- but could some a the quarter shares force return QX very

fruits say and through. I overall, would of So show some projects our of we've from we're that the to progress what starting seeing the optimization had

I as a well. sector. is a what part of to was in strong interesting think us QX very opportunistic position very our very think time putting I in remain It's in that

David Schorlemer

Yes.

be lease the add expenses that as margins additional is we only I the thing to pressured will the I our fleet. by think, roll somewhat out Derek, would do

mindful something of. I to be So think that's

investing to we between along. this to where a cash intensity. significant million said, lower flow to to range going and were just and the capital $XXX as I forward. think in year flow last over cash that more in profile go we -- fleet flow the type going differential change complexion electric operations That's And our as OpEx that show free from effectively neutral a of and year equipment cash up being we the our materially going we're to a from from time, has more see

differential. material So a just it's

Derek Podhaizer

quarter. Great That's great so to thank hear. it All Sam I'll right. back much. turn and you David,

Operator

with next question from Benchmark. The Holland is Kurt Thanks.

Kurt Hallead

tough of market. I a just to in maybe pretty a clarify on things. operational couple Congrats great performance wanted

given got overall indicated in Sam, second And second XX the fleets You coming year. fleet overall quarter you of environment dynamics, at year. to your half another looking an operation, for on in comment flattish XX the the guys to your

So anything sequential are is the as with or revenue quarter you that this to and run potentially improvement fleet year? progresses? of that year kind is running give sequential literally, respect of we flat taking there Or improvement could kind the incremental for that place some taking margin first the rate

Sam Sledge

Yes. I our mean guide. That's our kind I'll XX reiterate mechanisms one that first guidance of main of activity to XX fleet.

moving So imply to I think that half the if we'd we be what market. white bit structure underlying go That's of in you printed of as to fleet during and creating the around midpoint, a from as or signal space a would fleet fundamentals that X little the that read or quarter just down compared don't a maybe be technically bit just a QX. of should little QX. the

to, the year remain that mean, almost I So than and really run a steadiest comes what of, flow that anything continue seen continue standpoint the time think, We cash of we we is date customers for just and into I is this kind what for need sheet improve given us kind if that repeat like or downturn our one our circumstances we of operate, very we We to kind that, We looking albeit and to we've activity execute, work per be contracts prepared say, model don't we've to from and obviously worked we're you ability we're that that, never of a if very for. kind of leads are in of see executing our is very that operationally, very into the think this just that for -- really business. utilization I need a confident experience ourselves of exist this able can to execute this kind margins balance that our do today. to se. stable is the to a this. prospects this balance environment. back rinse steadiest, to year seems And and other plan continue of you last But be confidence type which to to just the the with to ability

coming use is low growth. it's the we or over purpose like say, it. us prior coming. no That's need in term companies So nor the decade, We on do we that cycles don't past wave you've the to heard next think

really the proud to best the can this equipment, something on strong people. great replicate this in that position, be think, world with a side we So for in we're we I basin the time. long And that is good of think

David Schorlemer

was comments. to what you theme doing just some that Kurt, mentioned less. to give or And I was anecdotes the Sam our topic saying, we're with more That in

is higher relative down Looking quarter flow. XX%. our that free are down Year-over-year, of back revenues significantly then last we're period, very CapEx at the nearly third year, to but still generating good cash and EBITDA

need capital things to those and that potential. we're about support flow And or opportunities significant for cash don't mentioned, repurchase talking growth, opportunities the we growth it although the line as massive other it we need allocation other program focusing free Sam are present that does have. so, that generate the potential our we're don't to that on. And top We

Kurt Hallead

That's color. good Got it.

So just and context on capital that on allocation.

the that looking we're looks like at or in take. phrase flow, So right here first it what the XX% a about but share effectively you free is, cash companies of your lot Are have repo your on of quarter, hey, annualized flow to is percentage of Do specific you distribution basis? cash kind you're said, shareholders? allocate to a free of whatever to like an our kind of percent give going

Sam Sledge

things keyword do the sector, something a surface could times word the in environment our Kurt, different change. times. we The We right there dynamic capital possibly allocation, of kind use that continue in future. always don't We are now, changing has dynamic, even the M&A kind needs at described things with certain to earlier, steady business and at just I different of opportunities that

in now, and shareholder stay last fund do the to which simultaneously able been capital, business equipment basically we areas those things, across we'd have to allocate rather the really proud X kind core that. right returns M&A. is of X So and months proud all transition, nimble is X a to of that We've that

of kind for moving dynamic And prefer of flow a anything you or in So more percentage us -- while We'll stay terms like maybe that. prescriptive forward. time get a don't the before for being. of allocating a think us the I it of bit free see more same cash more opportunistic and to will I be

Operator

from comes Arun with JPMorgan. Jayaram question next The

Arun Jayaram

see bit around to context wanted I little more if the Sam, a Exxon and you give us award. David could

you You a been started and this talking ago. -- process, mentioned months talk relative about you think from what that this off bake whether impact. margin a maybe on this What you maybe could take-or-pay about financial overall Halliburton just Is your you And about to you success some talk kind the have a around of called perspective? was contract? see the drove Liberty? impact and -- the X details But what financials from

Sam Sledge

for. Yes, the that might sure. not asking be you you I'll likely detail give

that. they like ExxonMobil very flippantly. to prescribed. and think We person It's say more and That things this that sophisticated to said, you if used about sophisticated supply planned the process, Exxon's chain about want to it's ask they're then a -- we've company team, probably know have about that go get things think, a And some proprietary competitive, best done. is operation, safe a I very very I not to don't they're these

that place. believe will say feedback out to some around that reiterate happy a bells work work get to on approach and And if other customers and are these in just and fall big doing to safe all we just lead this from are then ExxonMobil, from those of of concerns sensitivities And that earlier something not solve get contracting in were proud into the a of to it's and start customers maybe smaller commercial just bit of of this and were think more we that collaborative agreement the we this maybe process. the big other there's love electric by from conversations things. items, things. standpoint to creative. in a those can said into more begin We forced I ours amount what that whistles we our but kind competitors main for involved We come did. kind firsthand I'll to So the I And their bit to process asking

we and commercial for it ourselves doing a to a XX, So that under just a we're That's we've structured new. to XX, customers, is with more agreement. of years, been doing XX nothing fit really. our technology that like bit new This

that of of So get don't encompasses answer if -- it helping on. get answer, I for, think that's the what been but I working we've know you kind asking you're kind your I don't

David Schorlemer

add Yes. And would the at one Arun, compete scale. been this questions is there's thing our I maybe around to ability some

field clearly X with already performance, that had our we think I fleets this shows Exxon.

solutions. field we they deliver that can was think and we in industry-leading them they confidence that were to providing electric I were in the results, at with X our see DGB the able which technology time, our providing had Tier and

to partner is scrutiny. as contract of and that This and speaks long-term able mentioned, the a a perspective. -- think that's not volumes do Sam itself I performance fact field without technology a ExxonMobil, analysis has we're a ProPetro with company that a lot from something, So and where as placed such they

So there's very position. heading this. there's to like put with -- able we way we're that's ourselves in this being And more pleased think our

Arun Jayaram

me you Well, of ask your going maybe not second question, some -- to I'm maybe commentary, David. clarify my just Interesting. let

an newbuilds. the you X they fleets the are So that X have you'd signed switching Does Or X? been working suggest at with agreement increasing be you you force X DGB mentioned Tier Obviously, that little for Exxon. comment bit opportunities. that if maybe on point a that just I see you wonder could was so you clarification elaborate other And your a mix there. maybe that at -- incremental of end. e-fleet towards the

Sam Sledge

Yes. for is existing I'll for replacement This our Sam. kind pick of Arun. fleet. up, Exxon This is that technically

assets fuel majority fleets on So we're those dual fuel ExxonMobil operation. and fleets force found home the as out these the marketing they've already those the replace of dual for our fleets

said So the that the not And for call for David growth replacement. opportunities. demand alluding continues then these it's simply And earlier or to I Exxon's future solutions. us in

to think along. and is this previously. limping of stuff conventional equipment the significant not our track like hitting our amount that -- first-class the for not just ExxonMobil with deployed equipment, our have it's customers demand is of equipment. I which comparable working that selling ground very This point operator not major efficiencies at being record It's electric continues a a

we've mean able replicate. comfort we So to -- some multiple said, have plan is other But the we it's like very generate we're fleets we're running. times something quickly demand because with record think, them this I is today that here operationally good. a track that I to with

to it capital like electric time Our approach, more some to our capital will is over at less always as has. and like equipment level attrit things -- continue technologies industrial to equipment more that equipment diesel allocate preference diesel allocation these capital to

I kind we've to in by that has some see mean think doesn't marketable whether asset fleet, we're of that very and we've attrition won't it something all It the to trying been of more going we side. in diesel see be we the kind invest of of and terms. we're getting last sticky dollar we've our the spend, dollar grade just to deploying we'll the cadence going the on high an operation. at luck our garner It Grand forward that seen that cadence that's been more -- of we was similar Design, means longer, -- to that rid contractual the continued -- So diesel kind that of or the we'll

Operator

Markets. question Capital next Saad Ricard comes The from ATB with

Ricard Saad

Congrats on that. quarter. Great

number clarification include $X.X operating $X.X expensing in million the question. lease The Does $XX.X a reconciling million. EBITDA Or million? the Just number for that items. that adjusted is fracturing hydraulic other for is embedded

David Schorlemer

EBITDA The is this of lease inclusive the expense. Carl, David. is Well,

item, the the We quarter. $X.X lease information roughly expense million, segment $X have for of million in line the

So you should see that in our press.

Ricard Saad

No, I Yes. that. see

Okay. to And in other quarter-over-quarter I'm EBITDA there? $X I going bit to saw line quite the close assuming that operations, on that's particular other Anything item. then, a million. $X.X all Sam, million fell cementing. from -- this

David Schorlemer

is David. this Carl, Well,

little Our submitting got operation of they're But had one a little keep those. are lines bit to around bit. in of to different the They've a going service complexion different slow bit move start. Things a are mind, picking customer a going -- each area. up -- in in that

that's Overall, seeing. top line And we're has improving. what so been

bit like but we for that that, second think see to business. a of recovery see so, And quarter into we the we'll

Ricard Saad

been Great. my answered other have Yes, Thank you all before. questions very much.

Operator

Thank you The next Gengaro question Stifel. Stephen comes with from

Stephen Gengaro

me pumping tracking I growth fleet -- of internal about? we that your is there utilization? for guess should business the assets beyond that about is as and think above side and wireline the your the first pressure Or business, X growing should we thinking be on

Sam Sledge

Like, as David have actually bit just different both a mentioned, of base. wireline a instrumenting customer

look cliff flat is XQ, in It's year spottier it. falling little I it XQ, we best different you said, could think they not should large should just anything. but The tad So don't in That see market, directions. than to movements it wireline think, It's relatively throughout a flat. is, is Stephen, different that as but I in in model you looser bit way a it's like off was or move as directions. -- the at the relatively

David Schorlemer

us the able a with contract fleet. One those little think just is an bit those deliver things in want And services. services opportunity ExxonMobil of the fracturing to bundle our connection for we being to is to did talk about I

that's They think significant that to do as that something I So of. share relates is we more a don't it overlap look something to customers.

but on there more of it the happening opportunity do an there's us to that, think for I ExxonMobil is contract.

Stephen Gengaro

do your forward. these things think think going lease you? we to with are -- and this versus the continue about decision over this about work the I do But and at force at point? you as how really time, to arrangements going provider the willing then make And How is couple obviously, well. you buy makeup And arrange fleets -- of about you've mean, point, got you a fleet Okay. talked

Sam Sledge

capital I Yes. And the buyout is at it's lease lease and end over say be lease of likely buying we're should these using. this likely beyond we're little the a we things could these a We're This bit here that transitory mechanism span leasing, to lease to think assets allow to don't year, have standpoint. buying mechanism from a multitask a the There period. future. not. the in allocation own. just really, more see be a you that would And us and option I using but of would be the would the that have

and I could also that's that's say -- our us I both of supplier. probably think I think mutual preference

Stephen Gengaro

Great. reclarification And of just question. cars then one kind of

fracturing. before That the but it's expense. Your adjusted obviously, after EBITDA lease of is, hydraulic $XX.X it's DNA, deducting million in

Sam Sledge

Yes. Correct.

Stephen Gengaro

to just had we Okay. right. Great. wanted make I that sure

Operator

next comes The with Gruber Citigroup. Scott question from

Scott Gruber

results. the Congrats on

Sam Sledge

Scott Thanks,

Scott Gruber

the of could terms more fare. your focus a Was those the Can or great be I ProPetro. performance you it's we kind And back that they of Sam, win new to on new Or kind come in the for want EBITDA new about since the of point standard contracts in on margin? as think incentives a meaningful? impact, kind of to those contracts? of touch more

Sam Sledge

to I incentives might from performance. paid always different performance customer, bit little our say a the basically after try to Yes. fair. standard that get that and customer are would They but we're look that's for something

information, I'll And of there. getting question? repeating your leave your I'm question. forgetting into second competitive Can kind without So second that mind you

Scott Gruber

on know was you it. That -- touched I

do comment. want I CapEx to it. on the on touched clarify You

towards end lower million year. the mentioned for You the $XXX

get mentioned fifth to You fleet. execute on also you the

you're you think if and assume should to So the going the do to about we that stay is probably it? that that towards lease Is end, lower week. way

Sam Sledge

correct. be That'd

Scott Gruber

one maybe And more Okay. I'll in. squeeze

Permian. Just gas the now outlook. limiting of really are in right the kind egress In the guys constraints thoughts on year, slow the the wondering the you growth growth of just I'm basin. rest mentioned a whether

but a not oil or really? they privates for lot whole think constraints these work obviously You of a higher private, the market are you watch prices guys limiting from to don't to the Do tightness perspective. the them do response gases

Sam Sledge

not reasons, Permian to we the is best but to that no I'm got think it out on. a to people got into terms sophisticated putting to for rigs working I of many best on the of obvious not for the unbiased that minimal I infrastructure. ask we're I know we -- in Basin more the I best back do X it Permian don't lot are got is think the we've think from there. we've already Look, to said, others the could we've year. working that That And base the if work. that have with planned have planners effect the X activity private But customer base. most who or think maybe we're customer that of best There's who's we're our smartest, holding

Things our right any balance the affect now our activity. indication that have the will affect that activity it it tells our that we year of -- affect like So us for don't should will

Scott Gruber

Appreciate color. the

Operator

TPH. question next The from Leblanc with Jeffrey comes

Jeffrey LeBlanc

you I Simul for my could Thanks operations fleets? had to deploy question. was, continue Frac color you as any provide Question on taking

Sam Sledge

heavily involved in Yes, it dating Simul-Frac, early was good what We've question. XXXX. been XXXX? back to Yes.

and we've really that good So track record. history a operation great got at a

of zipper right of think both regular pair really now, Simul-Frac as able we power kind because have do fleets. of That I and you're horsepower mean, we and to well it together in simul-frac I operations density and look said, at force a e-fleets the just our mix generate. operations

think Simul-Frac. I it enables like more to continues things space the naturally, consolidate, E&P

anything, it future, it's the in the not think, portfolio job across our or in type the So swings massive but little I bit a there's sector. maybe of more

Jeffrey LeBlanc

much. very operator. you call back the I'll to Thank hand the

Operator

The with next Daniel question comes from Blake McLean Energy Partners.

Blake McLean

was X color forward. just I've hoping and characterized you between provide hoping little kind already could to electric good maybe quantify R&M range of might E-fleets a on versus of maintenance. see context the metric a lot questions got you lower that generally asked. around on of as Tier savings get parent X I having them? little of I versus A some Tier maybe one. maybe bit of was going

David Schorlemer

is this Blake, David. Yes.

the our some e-fleets. intensity for right XX% of and allocation operational you capital the exists. is lower lower sense overhead think maintenance a of That that about I now, intensity gives

time is these got We've in out. one fleets their bit we more operations. mentioned, going another Sam as operating as take think out roll like a one got of today, June. them I which we'd only X into of We've to week a

lower intensity forward. to data to think and share much overall, on at OpEx more I we're have looking But XX% going for XX% we'll capital that. lower So fleets those

Sam Sledge

things the mechanics to do. are looking for Yes,

Blake McLean

quarter. very much. Good up. you. Thank you right. Great All Well, all thank

Operator

This to would I concludes for hand call closing session. like back our remarks. the to Sam Sledge now question-and-answer

Sam Sledge

everyone, we us again hope for talk you today, soon. joining to and Thanks, to

Operator

for has your participation. now you concluded. Thank The conference

disconnect lines. You may now your

ProPetro Holding (PUMP) 1 May 242024 Q1 Earnings call transcript