Core Viewpoint - Natural Gas Services Group, Inc. ("NGS") reported strong financial results for Q3 2024, with significant growth in rental revenue and adjusted EBITDA, while also increasing its guidance for FY 2024 and providing preliminary insights for FY 2025 capital expenditures [1][4][5]. Financial Performance - Q3 2024 rental revenue reached $37.4 million, a 35% increase compared to Q3 2023 and a 7% increase sequentially [3]. - Net income for Q3 2024 was $5.0 million, or $0.40 per basic share, compared to $2.2 million, or $0.18 per basic share in Q3 2023 [11]. - Adjusted EBITDA for Q3 2024 was $18.2 million, a 53.7% increase from $11.8 million in Q3 2023 [12]. - Total revenue for Q3 2024 increased by 29.7% to $40.7 million from $31.4 million in Q3 2023 [8]. Guidance and Outlook - The company updated its FY 2024 Adjusted EBITDA guidance to a range of $67 million to $69 million, up from the previous range of $64 million to $68 million [5][6]. - FY 2024 growth capital expenditures are now expected to be between $65 million and $75 million, with FY 2025 growth capital expenditures projected at $90 million to $110 million [2][6]. - The target return on invested capital remains at least 20% [2]. Operational Highlights - The leverage ratio as of September 30, 2024, was 2.25, indicating a stable financial position [14]. - Rented horsepower at the end of Q3 2024 was 475,534, a 19% increase year-over-year [3]. - Horsepower utilization improved to 82.0%, up 330 basis points from the previous year [3]. Management Commentary - The CEO highlighted robust compression demand, particularly in the Permian Basin, and emphasized the company's strategic investments in its rental fleet to drive future growth [4][7]. - The management expressed confidence in the favorable pricing environment and the potential for continued growth in horsepower and returns on invested capital [4][7].
Natural Gas Services Group, Inc. Reports Third Quarter 2024 Financial and Operating Results; Increases FY 2024 Adjusted EBITDA Guidance