PHX Energy Announces All-Time Record Fourth Quarter and Annual Revenue and Strong Financial Results

Core Insights - PHX Energy achieved its highest quarterly revenue in history for Q4 2024, generating $178.7 million, an 8% increase from $165.3 million in Q4 2023 [3][9][32] - The US division's revenue reached a record $132.3 million, up 8% from $122.1 million in the same quarter of 2023, while the Canadian division reported $46.3 million, a 7% increase from $43.3 million [10][11] - Despite increased revenue, adjusted EBITDA declined to $29.6 million (17% of revenue) from $35.4 million (21% of revenue) in Q4 2023, primarily due to higher equipment repair costs and weaker activity in high-margin revenue streams [12][41] Financial Highlights - For the year ended December 31, 2024, consolidated revenue was $659.7 million, a 1% increase from $656.3 million in 2023 [13][14] - Annual earnings decreased to $54.6 million ($1.16 per share) from $98.6 million ($1.96 per share) in 2023, with adjusted EBITDA at $123.7 million (19% of revenue) compared to $150.7 million (23% of revenue) in 2023 [14][16] - The corporation's cash flow from operating activities was $96.9 million for the year, with excess cash flow of $47.6 million after net capital expenditures of $46.5 million [5][20] Capital Expenditures and Shareholder Returns - Capital expenditures for 2024 totaled $83.3 million, with $73.4 million allocated to growing the drilling equipment fleet [24][26] - The corporation paid $37.6 million in dividends for the year, a 24% increase from 2023, and continued its Normal Course Issuer Bid (NCIB), repurchasing 2,141,232 shares for $20.6 million [19][22] - The board approved a preliminary capital expenditure budget of $50 million for 2025, with expectations to spend $55 million including carryover from 2024 [26] Operational Performance - The corporation's consolidated operating days increased by 7% to 7,807 days in Q4 2024, outperforming industry trends where the US rig count declined by 6% [33][34] - The Canadian division's operating days grew by 6%, reflecting a strong market position and demand for high-margin services [11][35] - The average revenue per day for directional drilling services slightly decreased by 1% to $20,930 in Q4 2024 [36] Outlook and Strategic Focus - The corporation anticipates continued strong performance in 2025, particularly in the US division, driven by increased RSS utilization and proprietary technology [8] - Plans to expand the Atlas motor rental business are in place, with expectations for revenue growth aligned with customer fleet expansions [8] - The corporation remains committed to its Return of Capital Strategy (ROCS), targeting up to 70% of excess cash flow for shareholder returns [19]