Nine(US:NINE)2025-05-07 20:47Revenue and Profitability - Revenues increased by $8.3 million, or 6%, to $150.5 million for Q1 2025 compared to Q1 2024, primarily driven by an 18% increase in cementing revenue[92] - Adjusted gross profit rose by approximately $1.9 million to $28.0 million for Q1 2025, reflecting improved revenue and cost management[94] - The company anticipates a decline in revenue and profitability for Q2 2025 due to lower oil prices and reduced activity in the Permian Basin[86] - The loss before income taxes improved by $955,000, or 12%, to $(6.9) million for Q1 2025 compared to $(7.9) million in Q1 2024[91] - The company recorded a net loss of $(7.1) million for Q1 2025, a decrease of $994,000, or 12%, from $(8.1) million in Q1 2024[91] - Net loss decreased by $1.0 million, or 12%, to $7.1 million for Q1 2025, while Adjusted EBITDA increased by $1.5 million, or 10%, to $16.5 million[100] Costs and Expenses - Cost of revenues increased by $6.5 million, or 6%, to $122.5 million for Q1 2025, attributed to higher material and vehicle costs[93] - General and administrative expenses increased by $1.0 million to $13.3 million for Q1 2025, mainly due to higher employee-related costs[94] - Non-operating expenses increased by $0.3 million to $12.6 million for Q1 2025 compared to Q1 2024, primarily due to decreased interest income[98] Cash Flow and Liquidity - Net cash used in operating activities decreased to $5.3 million in Q1 2025 from $8.8 million in Q1 2024, attributed to a $1.9 million increase in cash provided by working capital[134] - Net cash used in investing activities was $4.0 million in Q1 2025, down from $5.5 million in Q1 2024, due to a $1.5 million decrease in cash purchases of property and equipment[135] - Net cash used in financing activities decreased to $1.6 million in Q1 2025 from $6.2 million in Q1 2024, primarily due to $4.0 million in proceeds from the 2018 ABL Credit Facility[136] - As of March 31, 2025, the company had $17.3 million in cash and cash equivalents and $36.5 million available under the 2018 ABL Credit Facility, totaling $53.8 million in liquidity[116] Capital Expenditures and Debt - The planned capital expenditure budget for 2025 is expected to be between $15 million and $25 million, excluding possible acquisitions[114] - The company entered into an equity distribution agreement to sell shares of common stock with an aggregate offering price of up to $30.0 million[119] - The company completed a public offering of 300,000 units with an aggregate stated amount of $300.0 million, consisting of 13.000% Senior Secured Notes due 2028 and common stock[121] - The 2028 Notes will mature on February 1, 2028, with an annual interest rate of 13.000% payable semi-annually starting August 1, 2023[122] - As of March 31, 2025, the company had $47.0 million of borrowings under the 2018 ABL Credit Facility, with approximately $36.5 million available[128] - The 2018 ABL Credit Facility was amended to decrease its size from $200.0 million to $150.0 million and extend the maturity date to January 29, 2027[126] - The 2025 ABL Credit Agreement provides for a revolving credit facility with lender commitments of $125.0 million, maturing on May 1, 2028[129] - The company borrowed approximately $48.9 million under the 2025 ABL Credit Facility to repay all outstanding borrowings under the 2018 ABL Credit Facility[130] - The 2025 ABL Credit Agreement includes a financial covenant requiring a minimum fixed charge ratio of 1.10 to 1.00 when availability is less than $10.0 million[131] - The company was in compliance with all covenants contained in the Amended 2018 ABL Credit Agreement as of March 31, 2025[127] Market Conditions and Outlook - The average rig count in the U.S. was stable at 588 rigs in Q1 2025, compared to 586 rigs in Q4 2024[88] - Natural gas prices averaged approximately $2.19 for 2024 but recovered to about $4.14 in Q1 2025, impacting activity levels in natural gas basins[86] - The company remains cautiously optimistic about the long-term outlook for the energy sector, particularly in natural gas basins, despite current market challenges[89] Performance Metrics - Revenues for Q1 2025 were $150.5 million, up from $142.1 million in Q1 2024, resulting in a gross profit of $19.5 million[112] - Adjusted gross profit for Q1 2025 was $28.0 million, compared to $26.1 million in Q1 2024[112] - Adjusted ROIC for Q1 2025 was 8.8%, an increase from 6.0% in Q1 2024[109] - Total capital as of March 31, 2025, was $259.9 million, compared to $300.3 million as of March 31, 2024[109]