AESI - Earnings call transcript Q1 2024 | Atlas Energy Solutions Inc.

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Operator

Greetings. Welcome to Atlas Energy Solutions Inc.

First Quarter 2024 Financial and Operational Results Conference Call. [Operator Instructions]. I will now turn the conference over to Kyle Turlington, Vice President, Investor Relations. you. Thank

begin. may You

Kyle Turlington

will Bud the CEO, comments for on sharing to the Officer. Energy the of quarter With first Brigham, John are welcome and us XXXX, conference webcast operational Financial we be Bud financial Turner, call and Chairman; for quarter Executive will Q&A. and company's open and the their John and and Chief performance first the Solutions after Atlas which call today President Hello, of XXXX. for

Before remarks, remind we statements performance.Forward-looking uncertainties, to future are would everyone are management's U.S. are I that under certain and involve and as forward-looking assumptions statements that information statements Securities expectations defined and our not include based of begin guarantees prepared current statement predict. difficult risks, like on laws. Such of this to call as the the will this

such, actual materially. outcomes and results differ could As our

more XX-K filings. reports annual XX-Q about our the quarterly our these on in with You February XXXX, on SEC other filed can SEC and we learn XX, risks Form Form on report the

You to should measures, statements.We EBITDA, these metrics and free undue not also statements, non-GAAP will update certain reference cash make to forward-looking and such undertake no as on other operating and financial forward-looking we place adjusted flow, obligation adjusted reliance statistics.

Brigham. release.With You will Bud find said, I that in press turn the and will call morning's comments GAAP to reconciliation this the over calculations

Bud Brigham

to everyone call. and joining Thank conference our thanks you, quarter today Kyle, for us for first

we closing March. acquisition integrating and addition early some great an we'll on time making spend reviewing this Hi-Crush quarter progress providing first the update in of results, since In morning the Atlas that to our are

both their the and the on will no the have customers we safety recent more other continue discuss maintain delivering event. site our from fire to importantly, Additionally, and team proppant throughout reliable to our and go disruptive profit possibly has. Atlas I of Kermit to to need sand could producer supply customers facility at ahead the the impressive response perhaps way state also that

X/X sites and be also the needs met, their began nonproductive notifying the Within to X,XXX and from well acquisition Kermit great our and uniquely a throughput to close unexpected to prior quick continue centers Due and geographically service XX ascertained damage their sales of scale wonderful reviewing the occur. taking to trucks Atlas drying the Kermit differentiated will and the time the production incident. team tons we ensure traffic is again our even Today, zero affecting around first the reopened no By facility of Kermit our loading customers fire repairs. our ability end while loading quick sand. to and of supply ability our impact whether serving XX of to the at employees accidents, to to system, feed disruptions is be from supply at and out days accomplished and sand, reliably the actions importantly, our Briefly This from noon makes under through distributed or the Thankfully, a temporary employees want and June. event mobile recently other process for. that sand. turnaround was production involved rest the were we load-out response Within the to enhanced another feed uninterrupted our the chain steps everyone a and Atlas Monahans we limiting reliable and that this. to it's keeping the and employees Our rare the departments, Sunday, lay equipment the of Atlas' Kermit, to of could fire, severe Kermit began the at completely and safe quickly associated all accounted of sand-related load hours solution begin thank equipment have to to trucks damaging expect incident. month, sand restored plant unscarred. and fully is not was portion through plant. Andrew's did and culture. to our for the the we our of to fire, of of our demonstration obvious equipment to facility continue incident, the damaged at begin which Odessa, produce In most up Kermit all receive broke expect sustainable. safe by the with production Atlas think vendors including here of April began system, about plant, customers This this assets position incident West for redundancies on of Hi-Crush I do Atlas and we our quick resulting customer damage hours, teams clear supply separation and our our showing more company groundwork people, load necessary out the disruptions at limited and weather in and in unique our I Permian Again, the chain of our fire mobile the the of responders our silos. XX, rebuild silos plant facility, takes all which events Kermit end it's conducting

through our even the within of still quality we team of unbelievable, and the with could shouldn't thanks you not I The how the and scale, Atlas, platform With days distributed of quality Kermit people, are able prouder exceptional relationships know our unmatched surprised. fire, people, these our to can we I the our and our think that distributed we to more across point almost of they XX to instantaneously. this about see be have that at assets culture, to When information to we entire setback. the risk unexpected partner at on knowing wanted a under Our seems I assets as happened what making almost Again, pace disruptions. at which diverse our Kermit, repeat this just these make that of We Atlas better. circumstances. respect are be future. provide but count extreme was responded moved events facility to we to innovative the address you our the perform opportunities to uniquely incident collaborated in reopened great event shocking improvements reliability,

number there the and now the the First, that have in feed a are of factors that combined system between and starting we These root process failures. factors cause the result included analysis, in silos. plant contributing a fire completed to mechanical

and responding by reoccurrence. processes actions protect the are to risk of our to improve of number We systems us from taking a

For example, term, procedures. have near in enhanced the increased we maintenance preventive and and inspections

Dune -- incident and of enhancements events Express. planning made Dune systems multilayer a the more the of in and in years we've addresses automation design important will Express, our be significant This like specifically preventative in lubricating the Express, in the technological detection some the belt at Dune investments of to system the the technology maintenance the on moment an and the risk of plants. occurring feed around particularly this installed design construction on is in addition, X In the advanced auto systems spend

will belt dual on for systems: idlers as been pulley X for for for with be and which all in as we've pulley detection to mitigate dual the the previously, monitors discussing real-time the if will slippage of the loose interlocks and conveyor addition well to we conveyor The hardwired smart the example, down auto shut will monitors risk is preventative of the bearings bearings incidents. be the pulse if one detected. monitoring failures a slipping. to and For belt maintenance prevention other system have separate will is stop or lubricated, catastrophic Further,

conveyor and and sensors XX-mile monitors, along Dune will the subsequent X, Express, Executive believe cameras most I security Directors the up the data acquisition, Dune March likely Officer, as the Wrapping section, my advanced John of Turner on Express Chief the closing provide to ever of rail. that XXXX. is the Hi-Crush conveyor effective technologically real-time named the material Board built. Lastly, bolt

and leadership operations, John back will in provide to innovation building manage to the lead very to a innovative will outstanding highly proven team, management Atlas into and I to in team continue strategic Chairman, rest the creating and value. will of our as management As proppant Executive vision and and in Atlas to the Atlas opportunities. I leadership result XXXX. while management working and identifying our has premier the executive company's logistics in on company's team, our continue a John's founders active I will believe experience, industry. focus big remain operations entrepreneur, competitive continue shareholder and ideas were gas John continuing day-to-day And and continued future, company with of to has I and oil outstanding successfully growth been

NOV to Officer as Financial Blake of pleased addition effective of deserved recently promotion Atlas. appointment as Atlas Chief announce of much President In is May into I to Turner, XX, board and Blake With John of Grant leadership Prideco, guide the McCarthy, most served the excited the John. are and we welcome future. over Blake to to a will to call pass that, Atlas the now help expertise have his

John Turner

ahead to with kind I you, words, and we Blake company. comments have side-by-side echo for addition regarding a deep the our expertise public oil as your integration road addition as be acquisitions, Blake. industry with journey a for his the service Atlas. and will Blake's of those navigate Thank understanding of I just started welcome Bud, forward the look and markets along and financial as working we

quarter the permit to along the X the Atlas' new In a Hi-Crush for Pronghorn exciting recently commissioning dredge total of Atlas first acquisition, a successfully We acquisition the of in our set completion state-of-the-art with for a for The dredges. The our second late monthly great floated of already of was plants March, monthly Hi-Crush their and first closure Kermit first mile, and April. floated of loads. last an and record start. record set February in is new volume off expansion the with period Hi-Crush

emphasized commercial a commissioning drugs continues logistics a the to addition we expect for has by customers, It Dune which first solutions the June, footprint, by expanded quarter Express. been for into payload and integrated of amplifies date on Atlas XXXX the year logistics well be our the are for diverse both service Pronghorn's as as end offerings a evolve of completed Dune way and company. We a more provider remarkable Express Atlas' public of our process to our assets. fourth to of capacity end

I'm team them. proud lot a sure proud of and be to Our of, has

be will integration, Hi-Crush of as our workforces races think these it the resources is able the we best talented we accomplish what practices. with and exciting to combination acquisition, and Regarding share to to and are very the off about innovative

are The through dredge some of identification of working the of Express, Hi-Crush synergies million of among potential to to our announced for the that permit, through. and the procurement Dune to working the operation We are potentially the tie-in $XX that Hi-Crush's utilities acquisition. the permit time we additional initially at combination the infrastructure potential we are currently be of mining initiatives and programs brought the impactful beyond

feedback the of unparalleled our received mines The of acquisition last the assets. and positive of with on Atlas addition and the the combined through from profit We portfolio customers to and look truly serving the solutions. Dune logistics an better customers forward Express, provides offering mile our Hi-Crush have OnCore

operational platform's our to of also leader we in seam integrated with deliver which capability feature crews. digital We at solutions, on using we leading our sand with a market fully remains offering sites, with of sand technology-assisted last-mile released are Atlas based is feeds. Regarding crews, our XX inventory volumes are total inventory XX% the ordering proppant live Permian. now and Not customers' in last-mile technology, on feature, XX our only logistics, leading monitor well our of over the building automatic data Atlas

kind X confidence also optimized targets. off delivery human Combined their of we the without Gen digital our Atlas our order the and also autonomously digital its OptiOrder, in ordering the customers operational sand well off-the competition. Our while feature of optimize set sand platform production dispatch our first to functionality OptiDispatch ahead a giving provides feature, On meeting schedule, to keep and foresight intervention. of OptiDispatch the released

the OnCore that to Permian continue and of differentiation unit the of scale currently market while expect the efficiency, the proposition production Of in solution the larger under unit later long-term existing mobile automation, and is units month other deployed OnCore that digital mining Permian. the validating in OnCore a within advancing note, commence Our third capacity is a sales transformation #X Basin. the this with #X underway, leadership the deployed delivers the currently OnCore that this infield customer, Operation to X further innovation value unit contract double with an is Midland market. with This to has and of position team Basin. operators roughly we customer our drive the established the are

OnCore will deployments have compromise our X, orders that vendors future equipment beyond placed for the Regarding we Unit X. with

delivery multiple the mine quarter We equipment take agreements. have in to this of under expect sites third secured and option

our We deployment construction Express and and of facility. advanced the at of by potential Kermit are on was a the of not discussions customers remains impacted with the in Dune this events The number on unit. month time about last budget

on prices associated is XXXX X, the dividend returns on represents in our we continue Atlas around increased we major the the to pickup construction Frac XX and continued confident up to in completed the the of make the the we design the a ready the consolidation fall wildlife the Plant see dividend rig cattle expected our And this from quarter than conveyor count At with milestones low and Express XX% the include, is when of benefits X last more both completed quick remains XX% on April sand quarter. a through amplifies the year. completion $X.XX substantially of our have Kermit first have and not The be of quarter million we concrete crossings, Express, strides Notable crossings. for The drilling and installation more have the fracs, the dividend to the a completions timeline. Dune price yield and end of of the dialogue going the today Furthermore, once forma steady. XXX as today's has derisking The of recovery sleeper remain our led Lake this of Recent market. end run levels is of shareholder contracted Atlas of but efficiency growth growth working Atlas the our described in system which overall the CapEx fleet beyond will effect crossings with our the our to and of have we as increase installation. closing our more year-over-year a how increased now Permian's and the this proppant results, simul fourth and June. and for of go, XXXX, Dune Based to We nature CapEx current by ground our Permian much additions, the for highly turnaround XX volatility activity be than remains the feed delivery road to subsides. annually, of which we price $XX of X% of contracted of will sand which remaining compared of construction, in of dividend facility, nice X%. in flat were April, further tribal tailwind of can complete of and May changed XX% this Thanks it installation market share, main for sand when in have been efficiencies, and leased consumption. of the to resulting the than improvements which completed, for of great daily was business today, annualized highway to as the XX on month. and to Pro topic of occur. avenues XX% in strong commenced on The increase month. will April, expect maintenance peers.One modules remains mix end we by heavily belt end providing yet, are per has to low-cost and oil at $X.XX be personnel our conversation multiple

reported the of from million. which XXXX, sales a first includes we For $XXX quarter Hi-Crush, total contribution XX-day of

from tons. profit Our on of X.X million million was revenue sales $XXX volumes

As an start March. activity February quarter slow for off saw in get normal and but to the first cadence from expected, standpoint returned to a we a more January

Our first for average was ton. per the $XX sales quarter price approximately

of is million. generated quarter sales, consists reported million, which service to of operating was for Moving costs of for In cost $XX planned which revenue and excluding total, operation, operating our logistics by DD&A revenues we logistics million the of in $XXX $XX million the $XX quarter. cost sales

by which quarter, dependent as first we in we the $XX.XX, the on dredge was were were the March, ton throughout dredge operating mining plant new commissioning impacted negatively quarter. thus, our costs traditional less feed were and For per more

to our of operational rebuild new million, incremental was expense $X $XX expense during income interest facility of transaction compensation. dredges We the improvements quarter expect the for period. mining million and SG&A both interest is $X further our of $X million. the $X of the Cash $XX and for includes expense was performance of quarter the was the million, of which in stock-based quarter which costs Royalty was commencement complete. generated in offset provide nonrecurring million by noncash reductions for the Kermit hospitals, million

of was was by of $XX representing an EBITDA period XX% an million, Adjusted activities of income margin adjusted draw We of provided and $X.XX. interest million, $XX net share was cash decline for expect EBITDA to million. XX%. on for to income our a $XX our the representing projects. in earnings per and operating margin DD&A Net million, our cash generated $XX income quarter quarters the fund we we reserves future as net growth

define lower-margin ramp and acquisition. decline XXXX incorporate as with margins maintenance Adjusted less yielding the of in CapEx an commencement the quarter cash our the profile as margin quarters subsequent expect Express. should from adjusted logistics our the revenue of for Adjusted free EBITDA adjusted which we we cash margin EBITDA the from in segment to flow Dune lower We XX%. up million, improve EBITDA adjusted free flow, margins Hi-Crush $XX was

million Lastly, the the million going was $XXX million this quarter million. plant with first Kermit at in majority we expansion Cash $XXX the new $XX towards our total quarter, end of for the equivalents of spent Dune completion a debt the OnCore $XX at facilities. total spend projects growth of the and stood of on remaining Express of $XX of million the in the with

having second million $XX first expect the the less For rebuilt, volumes, the the from until place late to amounts associated load-out of spot some our June. our and fire in quarter, lower-margin which impact XX a sales we that results of manual, costs second efficient EBITDA a occurred higher plant with on third-party impact will be system The subsequent in and closure, source $XX feed occur from which loss to quarter be financial results to expected will which EBITDA the line implementation, of implies is with more temporary in meaningful XX-day OpEx sand million April quarter. is

mentioned system third complete, operations after resume the centers plant the plant's normal once and normal quarter fire the no is feed had we expect As of rebuild in impact the production on a the ramp-up. earlier, the to

do $XXX,XXX customers. construction the expect We to Express NPT minus have the deductible. Once rebuild or timing Dune any cause insurance we expect of be of the covered policies by event our not the impact again, a cost to our for any on fully the

collaboration, fire great and resourcefulness reopen That additional our update our Although to be appropriate. we on limit prepared of let facility we the more lingering for concludes questions. any impact, Thank we financials, joining reliably open for first could has guidance our customers. To extent will a to impact so remarks, proud and the of and the serve the modest operator quarter line employees all not in will you call. now impacts our when the the I can our quickly our teamwork quick financial

Operator

Energy first would you queue. [Operator Mitchell is ask is from indicate Sean to question If question your Partners. line Instructions] question, like Our the a Daniel with in

Sean Mitchell

Bud, congrats hire. on John, the

are it's team, to But to lucky I Blake have think the hire. join very of kind you business. McCarthy a great to moving and on

to to the of collaboration the able was pretty talked you the You Can fire, plant impressive. so guys after steps walk quite kind quickly were quickly? through the taken about you reopen reopen us in which required

John Turner

just efforts to I and of there. exactly them then it, Atlas get I'm kind Yes, going let Hi-Crush coming way obviously, it start sure. those Chris there. led that obviously, I'll operation -- what to run And performed team details. together. to was with they walk But did. and proud very collaboration Chris let out But employees into a through very, the the mean I'll came the both of back into go across up. and I'll Scholla the we

Chris Scholla

John. Thanks, Yes.

plant. we post-event first, a to to capabilities back take had step our process So really the understand of

So feed conveyor the It haul to with our load In that pure the teams week, watch to our transports look, construction the OnCore, safety our enable sand load capability combined saw, organizations. direction was load-out one able zipper bleed and unaffected, modify the has evaluation, can combined redundant integration an This direction to our way organically. were and the our conveyors ground-level of we new tower process screening sand backup to haul the conveyors essentially involving just It into was No a last main screening produce after we with under load handle occurred other out. absolute load-out were sand from stations; and so tower the both our across solution. effort different temporary a transport here. a equipment trucks finding required to We feeding trucks bidirectional, out creative to to temporary and formal that a feeding all last to leadership wet mile, was zipper the proven come including trucks. together becoming functions are companies, conveyor manufacturing, functions. challenge sand flow plants, sand dryers, newly these load-out, to with incredible

naturally current facility came entire to weeks, leadership X customers. develop short solution and online off of back and team. was together to our fact accomplishment, to trucks, within a teams The facility loading it incredible get nothing and serving was an creative our that the hats Our our Kermit

I that to across scale the and combined think differentiate continue industry in as our highlights will this Atlas the adaptability relationships as strength, company deep well our future.

Kyle Turlington

just that. last Sean, thing on

As scale I makes our on this The it's done question through had view mentioned culture. the obviously think makes Permian on reliable. call, No and and I the Atlas us making collaboration innovation it and this validates has and more had, have us on high better. work way disruption, we other -- company could the the

Sean Mitchell

Got response. it. Appreciate That's a it. great

Operator

with question next Raymond Jim is from Our James. Rollyson

James Rollyson

And or to a And just running starting fire quarter. great on on around up the and the had do. John, questions set commissioning. maybe guys be slides, older are those on time Maybe, the a once obviously, one at couple the just trial running mentioned noticed from dredges. facility. the in in of of things again, using for to third you reminder up dredges the you, the impact seems fully cost job Kermit Hi-Crush's Everything I what drill you of of A, OpEx the

up -- odds opportunity that, you thinking to how guys Just and that as success you've of maybe look how are time had are you at there. about

John Turner

Yes.

there together, $X out would working cost ton we're in at potentially far the As commissioned per around we and -- at a running, probably we're on decrease at a obviously, be dredges get once looking dredges these Kermit. at just as looking line That basis. up X go,

have number Monahans XXXX, won't see lot basis. I all our probably in in a around mining you our $XXX we feeding got hit the that of as we -- mines through feed we OnCore to you've all on as we -- think, our system obviously, have But the it's also it got a relates entire OpEx the all because, back So running base ton dredges, well. got now entire more assets when you at, OpEx were obviously, -- were

team dredges to pond going happen that going and not dredge, dredge and what's going As to Hi-Crush, running year. this far going as see that with together. the have there to We're it we're rental over dredge new the out. we dredge really we're focused there we're and out go a success likelihood run I dredge on going pond up a decommission want the to have of Kermit getting to to if or Yes, That's they likely, to that later know to happen going dredge works. put -- these know until take flip a probably out The We and and X running sure commissioned this a they when just that can do they make that want We in. don't is. over

it to it would bring we we But entire the I is think opportunity we're utilize out. feed Atlas I down Kermit dredge see could across I If a an going to to work. is there's of mines see mine at that out, think to contract work utilize there, up the there willing which the this one that doesn't lease, any run would to mine. able and how that given over to they if part that don't were mining think on other to not still -- we're there; the bring long-term have if the still dredge and other works over sign there a be permit that way facility dredge Hi-Crush both dredge

stages in early we're So figuring still Jim. that out, of the

James Rollyson

one had one of maybe largest And recently competitors Bud, get -- your by private you for helpful. Bud. That's it. equity. taken out Got

and of you that how market? curious might kind your strategic Just the view think on and that a both valuation impact from perspective

Bud Brigham

like investor Silica a with to a a cash depressed sophisticated very business Yes. premium that a see good free Thank and it's pay was really you. get value trying flow. excellent Obviously, U.S. good to for Apollo recognize

are certainly encourage our a company, in I confirmation production on deck. field the It in growth a that special Atlas we're generation really type more margins Slide investors -- our enterprise. just is terms very shown mean, I our probably midstream that higher with at line that's and XX and of obviously so or this much And than cash in services would multiple look slide to profile. attributes objective and those of seeing, what our And what's

so And our expand, there's Dune flows XXXX. in Express the distribution particularly cash our and opportunity see multiple expand for a lot -- growing here of to with to as

Operator

is Gruber next Citigroup. Scott with Our from question

Scott Gruber

to Yes, the good I back want question. morning. to come OpEx

guys benefits long dredges. You of discussed have the these

just new all together putting well. Just the with as terms assets in curious, of it Hi-Crush

and around get you these running kind move be Is for OpEx we the figure you a still thinking and dredges $X per next As up should bogey? of year? ton that mid-XXXX, into

John Turner

Yes.

at for. we're think from benefits shooting range hoping in Obviously, the is good synergies a what think number I that some at. I integration -- from additional look $X and I to kind probably get we think But there. that's of the $X, some

Scott Gruber

And wanted I I startup. loads Express, just just Dune appreciate Great. And... Okay. associated it. X to updated get the coming so mean then the contracting or from some were out months color back on to now we

around from any So the contracts you you can with associated provide what color additional the And on system? longer-term hearing customers especially are system.

John Turner

assets in to the to shut get contracts of also see they're -- site express, that contracts off about see sand They site. Express. Express what that wanting basically going have are make Express Yes. excited are Delaware the come to to going that the Dune standoff be operators a They will off stand Dune very are we that taking logistics We to it efficiencies, efficiencies with the the operating the because number do with Basin. utilize well lot but more up don't to Dune road. contracts, the to and be of fewer safer. well on are are have deliver taken Dune customers sand necessarily A ability our obviously it the

Delaware something XX that. there. I is signed Express. very increase exposure as our talk that getting we take customers. on you contracts currently now. some the is I look, ahead. with up relates for So that's contracts crews of about and get about folks up with, working feel right one And the working where right Basin good don't we them signed right we've now we're the contracting thing work off them Chris, supply to that and to mean logistics been go then to want sand But now Dune hard Basin Delaware running may sits also And customers are the our it currently And some

Chris Scholla

is Yes. -- know and Dune Express those customers we to From integrate be to that that Dune Express. continuing a do able and coming in seamlessly on build

just agreements, operations. those road, leveraging and this think the and And the current going running all come multi-trailer Dune that contracts. type Years as the mileage think approached what the ago, and through best naturally I the having peer crews seen customer in them our off of Dune Express we've Express right, XX work transition take efficiency see the public after is I we of

current Dune expect that We to customer our Delaware commissioning. the into on customers in customers current the right set grow Express flowing with continue seamlessly

Scott Gruber

appreciate the turn I Great. color. I'll back it

Operator

Derek Our with is Podhaizer next Barclays. question from

Derek Podhaizer

how on this provide year? you us know through could looking I bit. it's pricing you're quite if moving update down I at an a come was wondering

So pricing, on volumes on then contract. at And had the just current volumes obviously the are our mine impact amount of an the sideline. the your volumes

Just the the an year. update of X items rest would helpful for be around those

John Turner

Yes.

as is talk a recently We're off, a -- on those includes that in pricing we're first So contracts of logistics, different. somewhere still are probably contracting also we And I'll are the obviously mid-XXs. been some contract. lot that -- signing about signing which

our this volumes XX% price Right that's sand. year we around our contract, of for just now, So the of have contracted.

working are end quarter, mean, probably to runs let's from still That's there really into the frame. we -- say that's middle do contracting -- spot really the end -- those events a -- when some third one on number that We did currently have of quarter of probably, back. the kind time say, of then with out spot August -- That's coming that be I launch the coming the We are contracting we contracted. there's a increase way season our The mines of volumes time on -- with, volumes. that's those that the so coming lose fourth we volumes to are on. -- probably the We'll all go. to we for lot will our kind to be And also the we mine the we're that of be the we're going happened OnCore contracts volumes, mines taking still some able there's opportunity out our there. to spare Obviously, in let additional OnCore demand there of just of Kermit. think those say, got of capacity and as

going year, both that look, number and And logistics to not just out the we're looking sand contracts there through obviously, be mean, still I had. there's I sand of contracts. think So here, contracts a at

anybody... Chris... know I So don't if

Bud Brigham

tailwind the out I really more crews try efficiencies. the improvement with a or bit about with we mean, some talk et fracs, continued in a fact and I effects there certainly the have little cetera. efficiencies

for in the So about sense the I us. that that's optimistic And and a be are fundamentals year, and knows, private of probably is operators the nobody am second a tailwind it pick but bit little should the prices the personally we'll to see that oil is, constructive. the half of going up sense

John Turner

sand per see we've monthly. I seen internally, efficiencies I simul-frac the more -- are seen other -- obviously, of haven't to But and some year-over-year. I forecasts we're to XX% well, that. sand that I I per I than the think per we're frac say, that mean, there significant probably increase the mean, but think up with for number are demand crew starting out are you're running, you in a seeing crews that's simul-frac a think XX% pumps And there higher mean, seeing

So...

Chris Scholla

adoption The efficiency. one add for quick. thing electric real Derek, certainly in completion to more that increased fleet of is helpful rise And

So efficient are a and dual a fleet. fuel more diesel those we're than lot

that certainly that's So drive helping demand.

Derek Podhaizer

the book. obviously, That's in very opening see projects color. potential with you I you in or thinking towards you'll that the but about appreciate being about think Could logistics I all additional 'XX, helpful. what to OnCore mentioned million units additional I'm from comments $XX maintenance have I Any a program a us Right. aside XXXX CapEx. growth in that capital have just help about maintenance we're other wanted know units. free help that small versus going sure million return But us in moving pronghorn just $XX you the increases, think you're allocation 'XX. step dividend. will big CapEx, more down raising not flow structured XX, would cash Obviously, be of CapEx? pieces about to XXXX to helpful.

John Turner

the say the have like laid there's could will be of but but still I quarter, would haven't Express. things and commissioned like plans, the to Dune there's fourth -- is some going be as But... Express. year be Express don't that I runover of There's and end that we looking that We obviously, that things we mean, going deploying Dune probably it's I CapEx mean, proceed the out. down I going that's some But big some be some to I the probably from OnCore autonomously. to year, -- in the by delivering -- going mobile There's projects, The are hearing this be load to with some going be related in we trucking, units. CapEx but autonomous the don't about probably, other next be. potentially soon, at we'll at to -- much path be -- know how is we'll currently our we any more additional change. Dune looking sand can obviously, outs of don't some

Bud Brigham

CapEx Express, in through that. as at a period know, when general, we're you the you the In Dune on expansion had ramping down been and that very Yes. we've look of we heavy

that in of it's of remarkable as XXXX. our healthy so investment the -- my here year, it had but level out, we're view it's in and we've ramping down particularly, these in point And the in the that pretty half -- distributions CapEx, even through you high fact does second

a the we're to going invest position be up ramp very, relatively CapEx, to our cash able generation to luxurious a margins I also to be and more and given but So a of in Express our autonomous to in think, distributions, high reliability. and And that, of rate of return trucking for industry drive big delivery. eventually high up projects part efficiencies is the capacity some the course, drive Dune some

XXXX regard. that So looking exciting in is really

Derek Podhaizer

turn I'll it you, Thank guys. stuff. back. Good Great.

Operator

Keith Our next RBC is Markets. from MacKey question with Capital

Keith MacKey

about lay about are you still you added to appetite know just how I there's think to C-suite of opportunities you've wanted acquisitions company, priority inorganic out going within your experience your the you. lots and a today forward? for but potential a organic also that might of certainly for First start closed the sort on sizable growth acquisitions suggest with, one, to here. Can I ask opportunities from you just

John Turner

go? to want You Okay. No,

Sorry.

with so a But There's for and acquisition. for -- investors just we continue enhance story to a story, any project, the large evaluate. as look continue got flow I we help we're our acquisitions things But looking at opportunities -- to we meet sort we go. to at got something number -- looking we're making to big Hi-Crush rate look one. that, way at as that are Does don't do that said, through as together. businesses. our We've future as been to will we've kind far Yes. acquisitions, us acquisitions far our as of I -- and going of We've obviously said, that going return that well acquisition these our of when create high-margin kicked of sort Obviously, like has wanted return it are internal we obviously, you our same of hurdles. got yes, do we're we at integration from integration. really investments. We X the on have we goals. cash return As we here, integrated. things we're at look get tell just -- we're grow picked to has very that the will future any is as acquisition project teams goes and full The this I there, bringing Hi-Crush going off anything down, value these like working But identified project,

Bud Brigham

a it the and acquisitions from the acquisition, margins extremely point accretive It's add in our And we to as just I'll you projects Express have our given bar. that can anything general I'm cash that don't such our trucking of is the we rate on the have Hi-Crush generation, optimistic just high just comment. Dune an will a But was and and now... return high-capacity we and see more acquisition Obviously, the right can future. as

Keith MacKey

think the that means of And we maybe now. customer oilfield for just services about customer a the lots within what your in it well? market just bit that. general position if and Can you Permian the talk little as in right happening Appreciate about standpoint, from Okay. consolidation

Bud Brigham

it add Yes. grow matters. And drive for as you're these margins. that we scale able to through same true our appreciated Scale this the perform the down innovative, collaborative for and that the we've side. largest Thank that. despite scale and to to and associated our be you. provider. thing that the And their I'll our a culture, particularly lot is it. of our And recognize guys recent Atlas start, producer, a people execution And their customers. service that We seeing saw leverage disruptions operators enable by that. proppant former oilfield to And culture largest on to is us deliver with that there's great operator, our and want logistic and may to up and disruption cost drive then and

that important customers. our as service I to we efficiently So can to it's and from think as that, reliably we're benefiting we continue operate

in So that have you could that disruption, performed Nobody continue if that? a I think that the way. and we perform add to to unique to don't through have Atlas way going position. is I know want we're to

John Turner

-- ] are diversification a -- dry got [ is I have And X I mean Yes. Atlas diversification I other to mean serve be mine our provide that, going obviously, company We've Indiscernible great customers on I and no continue looking a X mean large think locations. there we're we lot continue out to of for mean it's the there's that strategy. that could with to strategy. to I to customers. going offering. logistics build

Bud Brigham

do, nobody we say match that. let's Yes can

Keith MacKey

Perfect. That's for me. it

Operator

with is question Smith Energy next Pickering from Partners. David Our

David Smith

QX the were of own it I thank with to the well of to as congratulations really was and incredible volumes over as Good reiterate impressive on just the you. the thought Blake that response want hiring delivered your morning, fire I logistics. half I your McCarthy.

Dune And for by about detail. sorry areas you're average And you're if seeing missed Have your be I be greater double if Express expect delivery to volumes a really, Express? online? what volumes average mix served is how the once would do seeing Dune talked you this in and triple deliveries. compared them But fully of to per delivery to trailer where you

John Turner

Yes.

to Dune around think capacity Express perspective, is crews crew at. with I a the from average volumes that to up XX be total what need XX volume looking today, current monthly per we'll we're

the looking grown we've As the us, business, our months. in right, I last you've side things, that last mean, somewhere at to the in range mile seen XX specifically of Delaware, in X XXx

pathway. crews, an So that down probable we X, out as ability to there, as continue achieve we X our highly see X crews additional

David Smith

when Yes, average And XXX be asked absolutely. the the thinking turns and per really about delivery right, day a trip the it. site. total function question I trucks, you've going maybe well wrong to of got appreciate but -- to and way, per capability volumes I is the

volumes real per that of average about are at trip to a the So or If X trailers X deliver site. a to thinking I well time. taking more customers was advantage ability the

John Turner

run depot Express -- now or the our you're guess us up will the success? recently opening from asking there. significant end side the an pretty here triple with of up. which a X where this, lives, end of trailers up So our So multi-trailer average We've of up volume we've starting third X, and continue we looking triple shortly. out there, for Polygon Dune see and in our last we I the year today a opened X multi-trailer X to believe double to I go first customers with to open payloads out now are with depots, additional one April trailers

of are double our to think completions use modify that customers I We've program triple trailers. had their them. even the utilizing and optimize look customers

our never nothing those trucks on road. around recent was the an customers that also location, success thing ago, there sizing with and once while Dune minimizing have people So to We've trailers. and efficiencies And X with see the optimize right? creative gain trucks this and but had same the thought in layout the off very would also public but they conversations was pad a Express, years idea. in double the getting the folks even It

for actions So I this think those and type customers heading of show with operations. really is multi-trailer our conversations the where

Operator

with Goldman Sachs. is from question next Our Neil Mehta

Neil Mehta

Dune is congrats Blake, John, comments, your first you Express. the your around promotion My for on as question Thanks Yes. well. in just

coming As about we're into think construction, really getting close to service. we

bottlenecks sense of the can you your around So confidence might interval items? exist? us the of And gating are give what last of last a executing kind that some

John Turner

Express obviously, moving been construction mean, the I has Dune along.

construction the not We impact people Dune itself have XXX is over Express construction going XXX out to The all. the of working -- at that. fire on there

In the it's to going to our fact, think I plant quickly. crews the enable tie-in to more install

any the another take quarter. -- As quarter, us we'll the that is process, to next sand fourth going until far And a X selling which of commission the early Dune is for quarter start to while, process supposed the as the to be commissioning but next won't of to... obviously, be is Express mean, I at bottleneck, of I third end off fourth the starting up the be then going for commissioning commissioning think start the to milestone to the end

Bud Brigham

that gas commissioning be running... a who about will John,

John Turner

that as the sand are the all the as sure sure running but Yes. to the belts commissioning is far sure got -- go what far the is I you're not Dune everything as down Express... still with road getting wildlife still as doing processing some go. we of is X mean crossings, folks make moving lease got already major that those But to crossings. ordered you've along the some in We've you're equipment. road working some the really -- construction. bugs on have the We've our the to We gating belts, running that But just to done mean, on just in make it's they're to making cattle out process all tracking expected out. -- some you're all up belt overhead order, worked I kind a overhead say, the got items, we've working and there major pricings

Neil Mehta

potential this dependent? preference to about is is doing the it return Do flow versus more inflection, talk Or to cash you alluded in Just thinking the you buybacks? how framework capital then we And XXXX as of to which about Board dividend the shareholders. of and in terms it the have the a see of well free price through return capital.

John Turner

we're that Right is focused say now, something right an that cash organization. we end what this That's discussed. something we're focused we that plan to we've get returning here something really But now, cash really really the as focused will our We I really into to not formal obviously in on would dividend that putting buybacks stock investors. before to next be shareholders. a think likely returning we're the is that of -- year. our is on paying

Operator

with from Bank is question Saurabh Pant next of America. Our

Saurabh Pant

that just around you assets some Kermit, not X out the I out go OnCore from But as just customers owned back integration looking questions the ops process months assets, from those Can share there integration. and just there, and can the negative, the have know move the as I but have of couple if to you If back now. going the think, assets. were on. the you you're I that early at for, come customers, through Hi-Crush just we to a teams talking feedback to you positive, right both heard

Bud Brigham

customer guys make John proximity just Hi-Crush to base a to opened obviously, Hi-Crush. in high-capacity Basin. the been Delaware strong really And have add Basin and mines in -- Hi-Crush and the is gave we those then want you logistical I'll which Delaware proppant This the the base a Basin, Atlas customer our largest did our to in the a base customer over for on Bud. to prior the mines serving and great operators basin OnCore Maybe the of them in mean, with a a Basin. to acquisition, the strong has even Midland very Midland trucking comment, I clearly, as job really real Atlas the in attracted the quick strong excitement general producer Express it. prior and may to business Dune

the Basin we're So scale really provide logistically and both it's obvious Midland the about quality. and are customers we the in reliability excited Delaware make benefit advantaged the now it to of -- that Atlas's that and

been it's if positive. to to know that. I don't so And very want you add

John Turner

a boil of player No, there. mines, if our that for think Midland our concerns mean, sand, both it Basin to a blender if proxable scale customers partner it's our But adding a I Midland well be and provider locating need out just were provide down. -- that I a to lot whether of I they had about that with Basin to today, that in single be back Basin Basin, our you to the mean Yes. the going in they're just can obviously, every Delaware of -- they that. to to sand going site sand customers weren't stand about Delaware across player whether we're then I to all a to delivering or able and the better the customers.

Saurabh Pant

Okay. Awesome. Awesome.

strategy. those right $XX kind that longer have gave duration continue still assuming pricing to Just the be? per just a talk and can one your you to bit right? is a asset. little Maybe strategy you lower that more for talk pricing is little I'm But maybe OnCore of a a OnCore versus guidance perspective, assets. that Because more would broadly us bit maybe pricing to ton contracts slightly thinking year, different I'm on that if Kermit you to the very $XX place just remind but the full for from about price me.

John Turner

really have a about for we're something -- will is what obviously those that what low Obviously, and strategy out produce one I our bring not pricing talking to down. to We're there. We is say going here. internally cost we we costs that's

It's mean cost obviously sand site. sand costs. competitive we well are obviously, price -- I very it so really it's comes lowest And delivery to both it's when delivery. about the to and

kind there, so really of where And Sand. we focus that's

Saurabh Pant

Perfect. Okay.

Okay, turn back. John. I'll it

Operator

the would to reached management our of have question-and-answer back We to turn conference like over session. closing remarks. I end for the

John Turner

everybody our next for we to second for our thank to us like quarter quarter our call. first We'd right. look results All call, and forward reporting on joining

Operator

today's will This conclude conference.

your You lines may disconnect time, for at thank this participation. and you your

Atlas Energy Solutions (AESI) 6 May 242024 Q1 Earnings call transcript