Financial Data and Key Metrics Changes - In Q4 2025, the company generated revenues of approximately $157 million, consistent with guidance, but decreased due to seasonality and budget exhaustion [10] - Adjusted EBITDA for Q4 was approximately $23 million, the highest quarterly adjusted EBITDA of the year, with an adjusted EBITDA margin of about 14% [10][11] - For the full year, corporate adjusted EBITDA loss was around $26 million, reflecting a structural rightsizing of G&A and a 12% decline in total headcount year-over-year [12] Business Line Data and Key Metrics Changes - Northeast MidCon revenue was essentially flat at $69.6 million, with an adjusted EBITDA margin expansion to 25.3% driven by gas-directed activity [11] - Dry gas revenue in the Northeast MidCon increased 5.3% quarter-over-quarter and 44% year-over-year [8][11] - Rockies revenue declined to $46.3 million, down approximately 9% sequentially, primarily due to weather and budget exhaustion [11] - Southwest revenue decreased about 10% to $50.9 million, linked to budget exhaustion and reduced oil-directed activity, but adjusted EBITDA increased to $6.8 million [11] Market Data and Key Metrics Changes - The company noted a 6% increase in rig count across the Northeast MidCon segment quarter-over-quarter [24] - The overall market is expected to see a gradual improvement, particularly in gas-directed basins, with a forecast for Q1 2026 revenue of $145 million-$150 million, down approximately 3% from Q1 2025 [20][18] Company Strategy and Development Direction - The company continues to focus on higher margin, technically differentiated work while maintaining cost discipline and strategically deploying capital [6] - The capital program is predominantly maintenance-oriented, with gross capital expenditures expected to be approximately $40 million for 2026, down from $49 million in 2025 [12][20] - The company is positioned to benefit from industry consolidation and capacity rationalization, with smaller competitors exiting the market [20] Management's Comments on Operating Environment and Future Outlook - Management expressed a constructive but measured outlook for 2026, anticipating Q1 to be the low point of the year due to seasonal factors [18] - The company is monitoring the impact of the Middle East conflict on market conditions, noting that historical trends show a 60-90 day lag in activity changes following commodity price movements [44][48] - The internal budget for 2026 contemplates flat to slightly up revenue compared to 2025, with improvements expected in the second half of the year [19] Other Important Information - The company ended 2025 with total debt of $258.3 million and available liquidity of approximately $56 million [13] - A proactive amendment to the indenture was made to provide covenant relief, allowing for a net leverage ratio of 4.5x through March 31, 2027 [16] Q&A Session Summary Question: Strength in Northeast MidCon - Management noted a 6% increase in rig count in the Northeast MidCon segment and attributed the strength to diverse geographic exposure and robust gas-directed activity [24][26] Question: Revenue Decline in Southwest - The revenue decline in the Southwest was attributed to budget exhaustion and completion programs tailing off, with some assets being realigned to other regions [32][33] Question: CapEx and Cash Flow Outlook - The company is targeting gross capital spending of $40 million for 2026, reflecting a prudent approach given the current market conditions [34][35] Question: PIK Option and Covenant Relief - Management explained that the PIK option provides flexibility in cash management, and the covenant relief was a proactive measure to ensure adequate cushion for future periods [36][37] Question: Impact of Middle East Conflict - Management indicated that the impact of the Middle East conflict is uncertain, but historical trends suggest a lag in activity changes following commodity price movements [44][48] Question: Simul-frac Adoption - The company has seen slower adoption of simul-frac in the MidCon compared to other basins, with approximately 25%-30% of operations utilizing this method [58][60] Question: U.S. Coiled Tubing Market - Management acknowledged attrition in the coiled tubing market, with some players exiting, but noted that the market is currently balanced without significant shortages [63][66]