Liberty Energy (US:LBRT)2022-02-22 11:33Debt and Financial Obligations - As of February 18, 2022, the company had $106.5 million outstanding under its Term Loan Facility and $133.0 million under its ABL Facility, with a total borrowing base of $273.1 million[136]. - The company may incur substantial additional debt, which could limit its flexibility in planning and obtaining financing for working capital and acquisitions[137]. - The company had $124.5 million of debt outstanding at December 31, 2021, with a weighted average interest rate of 8.6%, where a 1% change in interest rates would impact interest expense by approximately $1.2 million per year[249]. Market and Economic Conditions - The demand for hydraulic fracturing services is largely dependent on U.S. oil and natural gas drilling activity, which is influenced by various uncontrollable factors including oil prices and economic conditions[247]. - A material decline in oil and natural gas prices could adversely affect the company's business, financial condition, and cash flows[248]. - The company is exposed to commodity price risk related to material and fuel purchases, which can fluctuate based on market conditions[250]. Operational Risks - The company acquired two state-of-the-art sand mines in the Permian Basin as part of the OneStim Acquisition, which may face risks related to environmental compliance and operational permits[146]. - The company is subject to stringent health and safety standards under the Federal Mine Safety and Health Act, and non-compliance could adversely affect its operations[149]. - Unsatisfactory safety performance could negatively impact customer relationships and revenues, as safety records are critical for customer retention[139]. Competitive Position - The company does not have patents for many key processes and technologies, which could diminish its competitive advantage if trade secrets are compromised[140].