Liberty Energy (LBRT) - 2024 Q2 - Quarterly Results

Financial and Operational Highlights Q2 2024 Performance Overview The company demonstrated strong performance with sequential growth in revenue and Adjusted EBITDA, driven by record operational efficiencies and shareholder returns Q2 2024 Key Metrics | Metric | Value | | :--- | :--- | | Revenue | $1.2 billion (8% sequential increase) | | Net Income | $108 million | | Fully Diluted EPS | $0.64 | | Adjusted EBITDA | $273 million (12% sequential increase) | | TTM Adjusted Pre-Tax ROCE | 28% | - Distributed $41 million to shareholders in Q2 through a combination of share repurchases ($30 million) and cash dividends ($12 million)[14][5][7] - Achieved significant operational milestones, including record pumping efficiencies, record safety performance, and the deployment of the Sentinel AI-powered logistics platform, which reduced proppant delivery downtime by 90%[14][15] - Advanced next-generation fleet technologies by achieving the highest diesel displacement in company history with natural gas-fueled digiFleets and commencing Liberty Power Innovations (LPI) operations[14][15] Financial Results Q2 2024 Performance Summary The company reported $1.2 billion in revenue and $273 million in Adjusted EBITDA, showing strong sequential growth despite a slight year-over-year decline Q2 2024 Financial Performance vs. Prior Periods | Financial Metric | Q2 2024 | Q1 2024 | Q2 2023 | | :--- | :--- | :--- | :--- | | Revenue | $1.2B | $1.1B | $1.2B | | Net Income | $108M | $82M | $153M | | Adjusted Net Income | $103M | $82M | $153M | | Adjusted EBITDA | $273M | $245M | $311M | | Diluted EPS | $0.64 | $0.48 | $0.87 | | Adjusted Diluted EPS | $0.61 | $0.48 | $0.87 | Balance Sheet and Liquidity As of June 30, 2024, the company maintained a solid liquidity position with $30 million in cash and $271 million in total available liquidity Liquidity Position as of June 30, 2024 | Metric | Amount | | :--- | :--- | | Cash on Hand | $30 million | | Total Debt | $147 million | | Total Liquidity | $271 million | Detailed Financial Statements The statements detail Q2 2024 operating income of $141.8 million on revenue of $1.16 billion, with total assets growing to $3.24 billion Consolidated Statements of Operations For Q2 2024, the company generated $1.16 billion in revenue and $108.4 million in net income, with a diluted EPS of $0.64 Statement of Operations Highlights (Q2 2024 vs Q2 2023, in thousands) | Line Item | Q2 2024 | Q2 2023 | | :--- | :--- | :--- | | Revenue | $1,159,884 | $1,194,988 | | Operating Income | $141,833 | $206,478 | | Net Income | $108,421 | $152,671 | | Diluted EPS | $0.64 | $0.87 | Consolidated Balance Sheets As of June 30, 2024, total assets stood at $3.24 billion, supported by $1.94 billion in total stockholders' equity Balance Sheet Highlights (in thousands) | Account | June 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Current Assets | $1,002,312 | $954,254 | | Total Assets | $3,241,355 | $3,033,557 | | Total Liabilities | $1,304,460 | $1,192,149 | | Total Stockholders' Equity | $1,936,895 | $1,841,408 | Reconciliation of Non-GAAP Measures The company reconciled Q2 2024 Net Income of $108.4 million to an Adjusted EBITDA of $273.3 million after key adjustments Reconciliation of Net Income to Adjusted EBITDA (Q2 2024, in thousands) | Line Item | Amount | | :--- | :--- | | Net income | $108,421 | | D&A | $123,305 | | Interest expense, net | $8,063 | | Income tax expense | $32,550 | | EBITDA | $272,339 | | Stock-based compensation | $6,870 | | Other adjustments | ($5,953) | | Adjusted EBITDA | $273,256 | - The company achieved an Adjusted Pre-Tax Return on Capital Employed (ROCE) of 28% for the twelve months ended June 30, 2024[30] Business Outlook Market Conditions and Company Expectations Liberty anticipates stable financial performance in H2 2024, well-positioned to capitalize on E&P consolidation and demand for low-emission services - The company expects its financial performance in the second half of 2024 to be similar to the first half, even as overall North American completions activity is anticipated to soften modestly[5] - Long-term natural gas demand is expected to rise, driven by new LNG export facilities and growth in power demand, which should eventually lead to firmer prices[3] - The trend of E&P operator consolidation is increasing demand for service partners that can deliver superior performance and technical solutions, playing to Liberty's strengths[4] - The frac industry has seen a moderation in activity, and the attrition of older equipment may lead to tightness for quality frac crews in 2025[18] Shareholder Returns Share Repurchase Program In Q2 2024, the company repurchased $30 million in shares, with $362 million remaining under its current authorization Q2 2024 Share Repurchase Activity | Metric | Value | | :--- | :--- | | Shares Repurchased | 1,319,885 | | Average Price | $22.39 per share | | Total Cost | ~$30 million | | % of Shares Outstanding | 0.8% | - Since the program began on July 25, 2022, Liberty has cumulatively repurchased and retired 13.2% of its shares outstanding[5] - The total remaining authorization for future share repurchases is approximately $362 million[5] Cash Dividend The company paid a quarterly cash dividend of $0.07 per share, totaling approximately $12 million in Q2 2024, and approved a similar dividend for Q3 - Paid a quarterly cash dividend of $0.07 per share of Class A common stock, totaling approximately $12 million in Q2 2024[7] - On July 16, 2024, the Board declared a subsequent cash dividend of $0.07 per share, payable on September 20, 2024[21] Supplementary Information Conference Call Information Liberty will host a conference call on July 18, 2024, to discuss its second-quarter results, with access details provided for live and replay viewing - A conference call to discuss Q2 2024 results is scheduled for Thursday, July 18, 2024, at 10:00 a.m. Eastern Time[11] - Participation details, including dial-in numbers and a webcast link, are available, with a replay accessible until July 25, 2024[33] About Liberty & Non-GAAP Measures Liberty is a leading North American energy services firm that utilizes non-GAAP financial measures to provide a clearer assessment of its performance - Liberty is a Denver-based energy services firm founded in 2011, focused on next-generation technology for unconventional resource development[25] - The report uses non-GAAP measures like Adjusted EBITDA, Adjusted Net Income, and ROCE to help investors compare operating performance on a consistent basis[12] Forward-Looking Statements This report contains forward-looking statements based on current expectations that are subject to risks and uncertainties which could cause different actual results - The document contains forward-looking statements concerning business strategy, future performance, and market outlook, which are not guarantees of future results[35] - Readers are cautioned that actual results may differ materially from those implied by forward-looking statements due to various factors beyond the company's control[35]