ENSV - Earnings call transcript Q4 2019

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Operator

Good day, ladies and gentlemen, and welcome to your Enservco 2019 Year-End Earnings Call. All lines have been placed in a listen-only mode and the floor will be opened for your telephonic questions following the presentation. [Operator Instructions]

At this time, it is my pleasure to turn the floor over to Jay Pfeiffer. Sir, the floor is yours.

Jay Pfeiffer

Enservco's conference to welcome and XXXX call. year-end Hello, company Ian Dickinson, on behalf and are the of CFO. Presenting CEO; today Margie Hargrave,

reminder, of XX-K, as the uncertainties today's disclosed this as during and are that well management's matters the risks include date projections SEC. a and to estimates, as statements on are with company's call assumptions other and in filings subject forward-looking based As may discussed most recent

disclosure of to that respond material also business obligation to from differ because limited non-public point subject to to this results during certain management's selected cause Company's statements. call to no statements is ability FD, materially risks I'll anticipated of assumes could events. forward-looking is questions forward-looking Reg by in become those information. out subsequent SEC untrue that prohibits which actual to Enservco update

today's A the after webcast be replay enservco.com of available at call. call will

will call. news a two addition, in today's approximately release. telephone accessing replay replay available be or for webcast Instructions available beginning are In the after hours the

With call Ian go please Ian, over the that, Dickinson. ahead. to I'll turn

Ian Dickinson

turn our numbers. events financial a Jay. press the market the and thanks for year then comments issued our after joining far release call Thanks, brief provide XXXX review XXXX for and to fourth recap Welcome some XXXX. performance, of of closed. and macro full call. I'll in Today, over the as quarter on what I'll recent well the as so everyone we're seeing a we Margie results,

a came nine sharp revenue closed and levels. the year data the a higher XXXX in and Unfortunately, below we revenue adjusted of had most quarter revenue consecutive a fourth prior those XXXX. [probably] of two with up these the gains in slightly year and XXXX. in only XX% and offset months delivering first and in activity of in decline certainly through start positive profitability of XXXX EBITDA increase after We strong We reported years

in that Pennsylvania customer It's experienced services completions the gas challenges demand industry other and more fell pressure had frac Oklahoma operations was space. In for on in addition to already where QX, weather off warm QX, serious in services overall drilling we decline where far In now. right of facing oil lower is some areas no heating activity weather some seasonably sharply cooperative. secret in activity and players competitors us, and oilfield the the and put other our water

cases hovering related fears further certain the started to decline oil required to prices, turn make economic provide year an the to in slowdown a first we anyone think and have pricing place mid-XXs. retain Saudi-Russia all ourselves mid-XXs add sessions found of quarter in in oil in in to eroding due coupled around war, have To the I order Add to could perspective, coronavirus, is us the envisioned. with the that, price don't has that now and This margin customers. in

us in recap that, things put important in XXXX, favor. efficiently our a said think I better once to good the Having because position some turns accomplished more we macro back to of believe operate all I environment it's in they the

the previously our any customer our and customers point company we've Oil to due and than EMPs competitor; year history. to had Hot our grew new more primarily our share some of First XXXX, in at with added Adler market we foremost, we Services, base acquisition closed in largest

heating of the frac are from water In process. competition services, nation's critical further the in the and the ourselves largest distanced completions process, component an provider absolutely we which drilling as

XXXX water was integration was totaling of complete redundant in acquisition EBITDA transfer approximately and million two had annum. our was million reduce the costs. business, In to $X.X closure burn one operating three, equipment be which costs per addition, $X.X here of and overhead operators our of contributed further QX and to Step we more took several in clear, decisive basins. Adler steps non-core our our skilled not actually through we the reduction to of Step was the eliminate active and a the XXXX, of Oklahoma this which Oklahoma occurred To mean redeployment or are facility, alone. customers does there. the Step abandoning closure of

fleet We intend from have at and larger operation. cost them a workforce lower highly a remotely and to service Colorado mobile our

business completion utilization, better leverage In our this expanded now and investments regard, the efficiencies will refocus process areas fleet optimize past transfer mentioned services of of deployment. are increase to other order closure years improvement I've water implement competencies our made and we production evaluate in us our top have that and of spend reduction designed sense. initiatives -- just and On core our cost to couple initiatives to of leadership on and The discretionary continue things the allowed we makes over to the position. increase national mentioned, that and in fleet fleet

more a priority in to balance our high than will ratios line. for recognize of strong be very is continue we until Now us the importance and back de-levering ever, a get sheet, we

objective visibility anyone oil. course, this price on the heavily is that a no Of of And than of right in we more now, dependent have else. rebound process

despite and to and teams, continue laser-focused who remained appreciate that the customers our work environment I'm to want world of I a have closing, administrative service. with In our provide class and difficult to field say proud hard

of the highlights. that, review call with to financial a over Margie? And Margie for turn I'll our

Marjorie Hargrave

of results our operations. and The you, full Dillco business segment the our year discussing quarter hauling be water transfer as Thank I'll discontinued water fourth Ian. year and of reclassification results reflect today prior

year past differ on calls. certain ago those will referenced figures such, from As

of probably revenue on this new statement the In presentation addition, notice of income you’d face our a quarter.

revenue business customers’ we presentation well-site now completion and the better our both breaking We describes in We major think of our aspects services. are are communicates this two activities. fact services our production better segments, and into that engaged

year from revenue grew the services to increased for revenue X% million; services of from down million segment the million million to XX% $X.X $X.X slightly in a $XX.X to $XX.X prior to $X.X Production profit million production Components down of year-over-year million. included $X.X acidizing X% hot $XX.X $XX.X from $XX.X year. full in Total year million a ago. generated XXXX, services oiling million The million production up $XX million. from

and in increase business in costs to the Completion quarter variable and included X% $X million from operating SG&A $XX.X profit million direct services from profit and South segment increased $XXX,XXX revenue in with XXXX expenses million overruns first segment Wyoming, since in versus million a increased and approximately higher in year. million. discontinued $XX.X XXXX year-over-year The services $X.X Total $XX.X year-over-year Texas million a in prior of to associated generated increased amortization of Completion water higher our activity cost $XX.X depreciation growth million. investments and expense. transfer $X.X

due bad and to $X.X SG&A increase million last personnel year reserve, $X.X infrastructure. IT professional the investments to in an in fees to million from and higher higher debt related acquisition, and D&O overhead increased XX% Adler

benefit As cost as costs And in seeing quarter, with eliminated we're we moving by early that as reduction third Ian acquisition. million noted earlier, to forward the lower now had annualized other Adler associated approximately related of the well initiatives. overhead $X.X

due our from to $X.X Depreciation fleet. million million and larger expense amortization $X.X to increased XX%

Net the loss from gain a loss $X.X with $X.X year from $X.X from Adler last a in $X.X operations, increased million of million settlement Our million continuing increased operating ago. from million to XXXX sellers agreement including the April $X.X year. to million

$X.XX $X.XX a $X.X operations or XXXX discontinued $X.X diluted positive We per ago. from increased positive year million a loss diluted XXXX million per million the loss from reported in Net loss from Net in of million to $X.X down totaled of net prior adjusted $X.X million EBITDA for share $X.X or million, versus last $X.X year. a year. share

$X.X for in XXXX, in operations from million of XXXX. will to to in the foreseeable be anticipate the QX maintenance we CapEx primarily generated to Enservco annually. spending million future $X.X cash up in approximately and $X million range be related million $X.X capital from

a quarter million at services XX% $XXX,XXX, $X.X quarter fourth flat at year. revenue total million revenue declined QX from $X financial loss million consisting from last versus Production acidizing of $XXX,XXX fourth in generated our Completion revenue primarily the both to the segment ago. Production hot of results, $X.X oiling included services and at to also a fourth $XX.X $X.X was $XXX,XXX $X.X a in heating year water services essentially year-over-year flat frack million in year-over-year. profit approximately and segment to XX% quarter million of million. down Turning was

efficiencies in operating to million $XX.X segment of profit $X.X we $X.X SG&A $X.X acquisition. related a decline due supporting million to the year Total expenses decreased costs related due $XX.X last fourth year. to versus in declined to year-over-year the to production generated expense quarter to QX of services Completion primarily million a million last from million X% Adler and a $XXX,XXX from XX% segment completion achieved services. profit in variable

$XXX,XXX adjusted grew million was $XXX,XXX amortization income quarter diluted discontinued the to increased a Net $X.XX year. expense or loss in $XXX,XXX of Depreciation EBITDA $XXX,XXX loss from of We Net same XX% from quarter compared operations to Net $X.X last in last the operations was in fourth net last per fourth million due a from $X.X loss to had fleet of increased Loss of the last operations year. from million versus quarter last loss diluted per QX the million compared operations from positive $XXX,XXX and a versus positive share was year. $XXX,XXX of in loss year. size. quarter to year. continuing $X in from $X.X $X.XX loss $X to million, $X.X the same or a share million,

front, potential would Bank to over West with a status. amendment our closely On advance we current East resolve another that continue our lender work on

fixed a well received covenant fixed January, to resolving progress now. fourth these by charge our minimum You’ll hoped notice advance, quarter issues have We that as made agreement default in ratio regarding covenants over towards charge as recall of -- had more on liquidity violations. we loan and

process However, with investors details commodity XX-K longer and markets, out economic had report. our we that are apprised more the taking More upheaval turmoil debt impacting anticipated. and something will the once to is keep this in laid we than in global we is have on prices

as the QX approved standard NYSC American stockholders’ it Regarding Exchange informed the continued listed, our conference you listing New with last relates compliance equity. American that since call, York their to regain on updated we our plan us Stock they

able XX we on continues. to as the as details approximately have goal. as but share We're we not we will till towards at June equity process time, the you posted this of now can progress be keep that months further demonstrate We plan satisfy XXXX precise, X, to what share requirement our to long from

to prepared over concludes operator the for That call the questions. I'll our turn Operator? remarks. And now

Operator

Pavani Bhakti The Alliance you. with go Thank from floor open our [Operator questions. Instructions]. question for first now is Global. And Please comes ahead.

Bhakti Pavani

A activities. price quick of situation volatility, market a and drilled laid oil the the rigs number EMPs the and question, halted and completion given down drilling

for have how and kind quarter So, of that kind guys? of your for on preparing revenue is seen business, QX, what impact highest guys you which you especially are next in generating the you

Ian Dickinson

the for thanks Bhakti, Hi, question. Yes.

and activity prepared in So, the drilling QX. lay on down impact has an our the in you remarks referenced completions the had reduction and

the As into and through related activities. QX, primarily business relies on we move QX production QX and

And so, to in QX. drilling had QX on will impactful completions the and be QX certainly work our reduction an but impact less it and

Bhakti Pavani

expand And given rapidly, what could is company, taken have you on precautions spreading you those how which a kind are if and preparing very to-date, yourselves please? of you the situation coronavirus as

Ian Dickinson

precautions appropriate the operations. field all home office guidelines. little policy between are from the do There our so taking corporate and from is we're dynamics company we're to working able which CDC's as different following Well, what

paying watching cetera. et are communication work. our attention and customers hour So and to to to we’re policies on social so across this our in to by day, continuing their But distancing, close by locations to locations. staying We're operate any the changes normal, operate continuing scheduled our -- their the with close

monitoring. so ongoing it's an procedures. of And we're following appropriate But process all the

Bhakti Pavani

you. Thank

some do things operations maybe operation. are your other across about you Oklahoma? U.S. kind You you that and those did closing down Oklahoma there you that any Could Are talk you other think the in monitoring you please? did talk of would about

Ian Dickinson

services I -- us remotely Colorado. heating provided think and the in Oklahoma done out we've this past of for where we

but we're and would to that an to we're for opportunity we the ways make options. was sense generally monitor I the to was we're going and for on to more some perspective, speaking, levels cost this the that is, all make overhead evaluating from activity going can make a time workload demand. the based correct What moves But specific But move So us at only costs. be for continue say look efficient. eliminate to location that business

Operator

question Please Ascendiant comes Woo Ed next Capital. from ahead. go with our And

Ed Woo

prior on Yes. A quick back question. the question

your has coronavirus relatively? relatively that correct field the by is that been So operations unaffected

Ian Dickinson

this processes, Yes, rapidly is stage, at this aware. developing you a know, as everybody is

we Top priority just with. customers policy our employees make are, safety So I recommendations. we're folks the mentioned, is work our monitoring staying to CDC and the the actively speed we of to up sure to as that and with us

all of as across still them I all just changes, contact necessary taking accordingly. we'll stage, that staying locations. activity and respond we're operating we're so, close And monitoring And At precautions. and mentioned, extent with our we're customer in to the this

Ed Woo

this customers? about it a grim then you is right know And my -- you But from And the are your Great. barrel that for pretty little long now. -- talked is is what bit seems haul. are customers to obviously outlook question your to what oil going is, I hearing like like people going well? oil be least predicting, there acting $XX hearing as Is are the at the

Ian Dickinson

drop for and prepare But told services. our we've continued services, receiving, anybody related that. ask work, to in think of activity, that say is a the to production our expect don't hot continue pencil. for acidizing oiling customers from production major from drilling been expect off to been that, feedback sure. I are demand we've related completions our hearing What and what there'll knows going the of to the most we're but I us some our sharpen is to customers would be I

lower of for EMPs these out laying completion as points at think the down drilling production important going them. to wells these and for rigs, their they're price producing even maximizing I the is be

services But that to for going us to for and anybody hope exactly to and is head it's for know our demand sustained and months ability. some the we'll My to we as activity where quarter to here what's the continue sense again company thrown manage structure quarter cost us ahead. back weeks going handle to we have So, be rationality the market whatever completions to and quarters the our our production we're into impossible is and in services. important transpire fracking fourth third to back exit best and direction becomes see or proactive come the to the of

active very be employees our in constant So communication our in with and situation. managing we're going to We're proactive. customers, and are

Ed Woo

have And just is the the on then landscape. Great. question I competitive last

Are Now the get you maybe what what do out or of start obviously a you little anybody out you business there’s think people bit of easier turmoil, seeing you are landscape will seeing there? from see competitive and the competitors? going --

Ian Dickinson

Well, I for everybody. it's tough think

Adler share addition prepared mentioned picked share market had market into additional here heading from to the in I heating the As we remarks, season in this that took we the up acquisition.

our And know in some pressures placed on additional core so, I we've heating markets. our competition

that market as in to we've grown share consistently well Texas continue year-over-year. take as We market

where do be equipment I seeing immediately the and basins some got our who We've And on of work the could and those of plow I’d the we but stakes casualties. everybody. into Oklahoma not of put that, that operators to it's where like with and I prefer this folks out other got can move that the are we part specifically assets to some got can. is think of mean us we've we've what environment units that, some we're landscape this decision taking to move the my advantage improved action. as do reality for redeploy to as be there for difficult sense to the we're is going to going aware we're in comment forward. be competitors, competitive to

competitive going I it our think So as to it's relates be advantage to to situation.

Operator

[Operator questions I'm this Instructions]. And at showing no time. further

for So any it back over turn I'll to Margie and Ian closing.

Ian Dickinson

quarter. afternoon. of stays you. hope Have healthy appreciate we our and and call And, always, today. close look following I first talking everybody's safe. on nice We everybody to the Thank again, the forward a as attention time

Operator

We does conclude teleconference. appreciate that your And today's participation.

lines disconnect have and at this a may great day. You your time

Jay Pfeiffer	Pfeiffer High Investor Relations
Ian Dickinson	Chief Executive Officer
Marjorie Hargrave	Chief Financial Officer
Bhakti Pavani	Alliance Global Partners
Ed Woo	Ascendiant Capital

Enservco (ENSV) 20 Mar 202019 Q4 Earnings call transcript