WHD - Earnings call transcript Q1 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and thank you for standing by. Welcome to the Cactus Q1 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Boyd, conference and Director like speaker to Investor now Alan today, of would hand over the your Relations. I Corporate Development

Alan Boyd

us and today's you, good We you Thank morning. call. joining appreciate on

and today's today Private comments be call Officer; Scott Steve Chief Marsh, Financial Chairman Executive Will Interim Our General speakers Bender, Please Al we joining our for make President; any events Bender, our us covered will Keifer, on Also Operating Joel Reform and Tadlock, projections our of forward-looking FlexSteel; Chief CEO and future regarding Officer; note are Counsel. expectations Securities Officer. Bender, or statements Chief that Act. are by Litigation the Steven

statements SEC. or of uncertainties Forward-looking These our our and today no to and statements forward-looking our today's our are date, cause to can to forward-looking we in current number listeners review subject the risk differ many statements. are risks only any expectations. which of control. a are update publicly materially and Any of results uncertainties, discussed earnings actual obligation to beyond advise release from factors as with we We review undertake and risks filings the make

Scott. release. In earnings Reconciliations With addition, non-GAAP included that, comparable directly call, turn measures reference to most our financial will I'll of call certain during today's we measures. the non-GAAP are to over these GAAP in the measures

Scott Bender

sales quarter, large to from everyone. Technologies' particularly both our fourth Spoolable good which customers. began pleased morning in I'm first segments integrated to largely execution due the in Alan, Thanks, expectations. revenues the increased sales strong quarter, with our to and We XXXX solid exceeded as with

further overall also the activity product provides as the line our segment. as saw Cactus products well of demonstrates we strength, quarter, differentiation benefits in softness in period, the of which the the in inherent spoolable portfolio. international first this our During usual seasonal This renewed expanding

a of highlights who million. and million, increased company adjusted CFO, per of dividend quarterly million, EBITDA Al over I'll our our include will revenue of paid $XXX total call our of financial review to turn first the Keifer, results. now $XX share, margins $X.XX a EBITDA We adjusted Some quarter to balance $XXX cash we XX.X%.

Following provide the term for thoughts our outlook on his remarks, before near I'll the some for Q&A. lines opening

Al? So

Alan Keifer

Thank you.

As Scott million. mentioned, $XXX QX total were revenues

Operating segment, revenues declines were ] Control Pressure leverage. sequentially, or were primarily [ sequentially driven X.X% million points. points. Adjusted $X.X to decreasing our decreasing million EBITDA basis operating million sequentially, with XXX For decreased activity. $X margins or down The XXX $XXX lower income of by due segment decreased basis X.X% margin X% decreased customer margins by operating primarily with

Total our and other quarter. X.X% was down Corporate higher were quarter while segment QX, Depreciation first the noncash On related includes million, earn-out first for of demand total from liability loss $X.X quarter in resulting the in points XX.X% sequentially. $X.X million Technologies was which for for Operating an $XX FlexSteel amortization stock-based related EBITDA expenses quarter Control down accounting. XX.X% adjusted million during and costs. and million basis, and quarter the charges company expense decreased Spoolable million increase our the from first million. purchase expected included $XX company expense remeasurement Adjusted $XXX basis EBITDA first $XX total FlexSteel Pressure as the depreciation compared tax in to million which decreased expense fourth the XXX due with $XX.X quarter. $X and with sequentially amortization EBITDA of the by million, $X.X million segment, or to to of million, compensation first million $XX margins input expense the the recorded margin during fourth million income $X associated on quarter $XX Adjustments largely million EBITDA $X sequentially expense due part a in was a For from Adjusted during the segment is quarter remeasurement. during to customer earn-out X% were of million be is approximately revenues $X.X to to amortization decreased Technologies. up of to liability. $XX.X was intangible primarily Income X.X% majors. sequentially, of is million the approximately second assets an which increase the Spoolable associated of

in was an or effective company for of We tax rate adjusted the XX%. for Class share EPS of per Barring XXXX. of GAAP during rate the the net tax million to the A quarter, per largely that net earnings in for adjusted applied the will ownership income the respectively, be ownership $X.XX million quarter and quarter. share $X.XX in estimate million was The $XX XXXX. first was a second our net quarter, percentage, $XX XX% the of $XX increase public were QX the quarter. by fourth Adjusted million changes during public in of during share, the quarter driven earn-out income first per Adjusted compared $XX was approximately and rate income versus During further fourth net tax liability. the first quarter our XX% the and to the pretax the first remeasurement income. expect we XX% decrease

approved dividend first the a million per of the $X.XX cash a a members. million, million. was capex ended per of increase with million, quarterly paid Net related $XX a share dividend $XXX $X.XX of sequential of during June. approximately approximately balance approximately resulting We a share, quarterly to Board to quarter. first of outflow quarter, in $X $XX distributions cash paid quarter the including we During be The in has

estimated has outlook to million. in will currently XXXX third is be financial will I $XX additional of This In range offset Scott. which than full conclusion, outperformance now paid to consideration the earn-out That $XX.X call the remains year to turn FlexSteel revenue-based the year. been the million, the and to approximately Our more quarter of relative in substantial business, payment million the review, capex by covers be back $XX this over our expectations. of the

Scott Bender

Al. second our for quarter our of I'll expectations Thanks, touch segment. the XXXX, now reporting on

During levels the releases first as from be quarter, quarter second down U.S. we in expect our versus the to despite will essentially that anticipation the revenue approximately EBITDA segment to expense the be within quarter, effects the the are quarter. gas the lower Control count Control expected Pressure of be in first This slightly for stock-based period adjusted flat the segment. excludes average in relatively Adjusted margins our million EBITDA rig land of rig second basins at Pressure XX% $X guidance lead to XX% activity. to comp flat

As which coming on we introducing year should results operating latest wellhead mentioned previously, our to position. depending anticipate months, more impact significantly late customers in inventory our generation begin the to this

establishing exceeds Regarding business. believe our to with Mid-East options be to sensitive a control gas surface We But our the view forward recent pursuing at We towards and positive billion a stage, time. potential look $X.X shift are for expansion at the viable equipment Saudi further current annually, net share the I we plans, are to coming in commercially Arabia details X production in to this market in as the do more years. pressure market you we this onshore region. in material not presence we unconventional plan

revenue installation second are addition, segment, quarter of shipments, to better over the In seasonal up we the midstream the Technologies' expect international and terms outside from we industry currently efficiency of international order increased finalizing activity, from first slightly to to customers with Spoolable general significant sales a Switching quarter offsetting continued trends. Mid-East. be

to of customers. and enhanced relationships benefits the we're initiatives expand, core with enjoying cross-selling Our continue our

are adjusted margins in impacting expect quarter. XX% of recent We the Increased the to a have peak. half from XX% first input this the segment seen margins year, be we in for second the EBITDA although approximately moderation to costs

approximately our enhance expands that select pipe our Additionally, Note sourcing throughout supply source margin from components to in be as million expected $X.X which in million the which approximately compensation. excludes comp is corporate $X to effort EBITDA flat quarter, a low-cost stock-based pressure chain loss to Adjusted utilize stock-based this excludes first $X we margins XXXX. should of of this control, of the guidance million spoolable QX, product, segment. approximately began

strategy, include little low-cost international for and about our and plan that our backdrop reason year flows activity remain XXXX chain well generation diversification introduction latest several and optimism supply frac should provides this the innovations we the These wellhead, of cash markets. expansion into enhanced macro at of U.S. internal on the initiatives our levels, the progression initiatives returns. to improve Although market positioned execute

large gas our from Technologies later Spoolable our several Additionally, very recently international related I and increasing larger integration inquiries and of has with year. for inquiries are of outlook pipe number major pleased for increasing, this received customer lead acquisition. projects non-oil of orders growth Further, hydrogen along and market involved to existing from market to awards the with the with business a should wins midstream and strong above new which believe remain CCUS in business, a this applications, in a gain E&P the with inquiries rationale we in demonstrate differentiation reinforce further base, new and customer are We the recent segment. for testing. transmission These our customer this opportunity share these our further with customers

the to we over operator, back it Operator? turn I'll can and that, with Q&A. So begin

Operator

first Instructions] Stifel. question Our comes from Gengaro with [Operator Stephen

Stephen Gengaro

to about What when you From So, when a with just is your And basically I'll you about think we some where and really think from international for that? for our year? right? we opportunities North our it growth. next statement, America, two international we guys, forecast? of mentioned it later things to start this expect think up -- you've about me. showing about model need income year? seat, would be baking we How of should Is on picture, bigger thinking large sort Is into the sort that start

Scott Bender

Yes.

year I it think for would next be to meaningful be entry. it a

Stephen Gengaro

trending do oil -- stabilizing, over market, in optimism activity think it obviously, when of about a what the of a not plateau kind this half lower. a And as this not of at Okay. when see kind the coming think do [indiscernible] hopefully little second time, do -- talking catalyst and see year, this But get do we you least you I you if get mean, land U.S. you direction? higher. size you the maybe the of bit your lot about you sort here about of in back how views to And right we've mentioned year? is more off but is But gas sort heard of a maybe of activity the quarter moving U.S.

Scott Bender

$X.XX sorry, I've don't trough I $X.XX hit But opinion XXX I'm about trough we'll maybe my activity ] the to range. Steven, [ we changed think a onshore in summer. that exit think to I Yes. XXX as -- hitting the

And be that so a will for time plateau. maybe a

Operator

any time. remarks. I'm call further to for the this like Instructions] any now showing turn I would to [Operator Scott at not closing Bender back questions over

Scott Bender

All But right. must this your calls the Well, I earnings conflicting I some of all -- know thank absolutely much. support we have appreciate all we company. very you had morning. I

need day, job express the for I at everybody. asked, think have I I for Anyway, Tadlock and gratitude that my to business. of calling. a although extreme for that our good the Spoolables he's bright not expansion outlook done Thanks think to Steve

Operator

concludes for participation. This the you. Thank you your Thank conference.

now may disconnect. You

Cactus (WHD) 2 May 242024 Q1 Earnings call transcript