Core Insights - Pembina Pipeline Corporation (PBA) reported third-quarter 2025 earnings per share of 31 cents, missing the Zacks Consensus Estimate of 45 cents and down from 44 cents in the same quarter last year, primarily due to weaker results in the Marketing & New Ventures segment and soft delivery in the Pipelines segment [1][2] Financial Performance - Quarterly revenues were $1.3 billion, a decrease of approximately 3.8% year over year, and also missed the Zacks Consensus Estimate by 1.6% [2] - Operating cash flow decreased about 12.1% to C$810 million, while adjusted EBITDA increased 1.5% year over year to C$1 billion, driven by higher net revenues from the Peace Pipeline system and the Alliance Pipeline [2] - The company reported volumes of 3,959 mboe/d in the third quarter, compared to 3,892 mboe/d in the prior-year quarter [3] Dividends and Growth Initiatives - Pembina's board declared a quarterly cash dividend of 71 Canadian cents per share, payable on December 31, 2025, to shareholders of record as of December 15 [3] - The company made significant progress in growth initiatives, securing new transportation commitments on the Peace Pipeline and improving contract stability on the Alliance Pipeline [4] Segment Performance - In the Pipelines segment, adjusted EBITDA was C$630 million, a 6.2% increase from the previous year, supported by stronger demand and higher revenues [6] - The Facilities segment saw adjusted EBITDA rise to C$354 million, driven by higher contributions from PGI and increased volumes at the Duvernay Complex [7] - The Marketing & New Ventures segment's adjusted EBITDA decreased to C$99 million, down from C$159 million, due to lower net revenues and higher input costs [8] Capital Expenditure and Balance Sheet - Pembina's capital expenditure for the quarter was C$178 million, down from C$262 million a year ago [10] - As of September 30, the company had cash and cash equivalents of C$149 million and long-term debt of C$12.6 billion, with a debt-to-capitalization ratio of 42.6% [10] 2025 Guidance - The company expects 2025 adjusted EBITDA to be in the range of C$4.25 billion to C$4.35 billion, slightly adjusted from the previous guidance of C$4.23 billion to C$4.43 billion [11]

Financial Data and Key Metrics Changes - Total revenue for the first quarter of 2025 was $62,500,000, representing a 17% sequential increase from the fourth quarter of 2024 [12] - The net loss for the first quarter was $500,000, or a loss of $0.01 per diluted share, compared to a net loss of $15,500,000, or a loss of $0.32 per diluted share in the previous quarter [19] - Adjusted EBITDA was positive at $2,700,000 in the first quarter, compared to a negative $4,800,000 in the fourth quarter of 2024 [19] Business Line Data and Key Metrics Changes - Well Completions Services generated revenue of $20,900,000 with an average of 1.3 active pressure pumping fleets, up from $15,800,000 with 1.1 active fleets in the previous quarter [14] - The Sands segment sold approximately 189,000 tons of sand at an average price of $21.49 per ton, compared to 129,000 tons at $22.54 per ton in the fourth quarter [16] - Infrastructure Services revenue was $30,700,000 for the first quarter, a 10% sequential increase compared to the fourth quarter [17] Market Data and Key Metrics Changes - The company anticipates increased competition in gas basins due to strong fundamental support for natural gas, which may slightly squeeze margins in the near term [11] - There is uncertainty in the energy market stemming from tariffs, economic conditions, and geopolitical events, which have begun to affect oil prices [10] Company Strategy and Development Direction - The company is evaluating strategic opportunities to add accretive assets while maintaining a strong balance sheet [5] - Following the sale of three subsidiaries, the company will focus on engineering and fiber within the Infrastructure Services segment [17] - The company plans to strategically deploy capital to grow existing businesses that generate the greatest returns [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the team's ability to drive value for shareholders despite market uncertainties [9] - The company expects steady completions activity in 2025, with potential upside into 2026 driven by natural gas demand [14] - Management highlighted the importance of cost management and operational efficiency in navigating market challenges [22] Other Important Information - As of March 31, 2025, the company had unrestricted cash of approximately $56,700,000, with total liquidity of about $79,400,000 [21] - Following recent transactions, the company had unrestricted cash of $135,400,000 and total liquidity of $202,900,000 as of May 2, 2025 [21] Q&A Session Summary Question: Can you discuss the uplift in volumes in the sand business and your outlook for the rest of the year? - Management noted strong demand in Western Canada for sand pricing and expects a stable environment to persist through 2025 [26] Question: What cost actions could be taken if there is potential weakness in the back half of the year? - Management indicated that the biggest lever for cost management would be on staffing and repairs and maintenance, with a history of effectively managing the cost structure [28]

Financial Data and Key Metrics Changes - First quarter revenues decreased by 1% to $333 million compared to the fourth quarter of 2024 [24] - EBITDA increased to $49.489 million from $46.1 million, with an EBITDA margin rising by 100 basis points sequentially to 14.7% [29] - Diluted EPS remained flat at 6¢ compared to the fourth quarter [28] Business Line Data and Key Metrics Changes - Pressure pumping revenues were essentially flat sequentially, representing 40.1% of total revenues [24][7] - Downhole tools revenues were flat, accounting for 28.2% of total revenues [24][12] - Rental tools saw a notable gain of about 7% [13] Market Data and Key Metrics Changes - The overall service lines in aggregate declined by 1% [7] - Demand and utilization for tier two diesel equipment remain challenging, with competitive pricing in the market [9] Company Strategy and Development Direction - The acquisition of Pentel for $245 million is expected to enhance operational scale and focus on high cash flow generating service lines [14][20] - The company aims to balance pricing and utilization strategies while maintaining asset quality [10] - Future capital expenditures are projected between $165 to $215 million, primarily for maintenance [29] Management's Comments on Operating Environment and Future Outlook - The management expressed concerns about macro uncertainties driven by tariffs and their impact on inflation and the economy [35] - Oil prices falling to the low $60 range may affect customer completion activities [36] - Despite uncertainties, the company maintains a strong balance sheet and secure dividends [37] Other Important Information - The company filed an S-3 registration statement with the SEC for the Rollins Family Control Group shares, viewed as good corporate housekeeping [34] - Steve Lewis was welcomed to the board of directors, while Gary Rollins and Pam Rollins retired [39] Q&A Session Summary Question: What are the current pricing conversations in the pressure pumping market? - Management noted that while discussions are similar to previous cycles, the current circumstances may impact these discussions due to lower oil prices [48][50] Question: What are the capital allocation priorities post-Pentel acquisition? - The focus is on accretive transactions, exposure to larger customers, and businesses with good free cash flow potential [52][54] Question: What is the expected revenue for Pentel? - Pentel generated over $400 million in 2024, with quarterly revenues around $100 million [56][58] Question: Is there a shift in customer activity towards lower CapEx projects? - Management indicated it is early to determine shifts but acknowledged that such changes have occurred in prior cycles [66][72] Question: Are there any signs of increased gas-directed activity? - Management believes that any uptick in gas-directed activity is likely further down the road [74][76] Question: What is the company's stance on selling older equipment? - The company monitors its equipment and aims to avoid reintroducing older assets into the market, focusing on reallocating them to other service lines [92][94] Question: What factors would lead to an acceleration in CapEx spending? - CapEx spending will depend on market conditions and the need to maintain equipment or pursue accretive opportunities [100][101] Question: Is the company focused on consolidating the Permian market or open to other basins? - Management stated they are open to opportunities in various basins, not just the Permian [108][110]

Financial Data and Key Metrics Changes - Revenues decreased by 1% to $333 million in the first quarter compared to the previous quarter [17] - EBITDA increased to $48.9 million from $46.1 million, with EBITDA margin rising by 100 basis points to 14.7% [21] - Diluted EPS remained flat at $0.06 [21] - Operating cash flow was $39.9 million, with free cash flow of $7.6 million after capital expenditures of $32.3 million [21] Business Line Data and Key Metrics Changes - Pressure pumping revenues accounted for 40.1% of total revenues, while downhole tools represented 28.2%, coiled tubing 9.6%, cementing 8.3%, and rental tools 4.6% [17] - Pressure pumping revenues were flat sequentially, while other service lines collectively declined by 1% [6][17] - Rental tools saw a notable gain of approximately 7% [10] Market Data and Key Metrics Changes - The company noted challenges in demand and utilization for Tier two diesel equipment, with a highly competitive pricing environment in the spot and semi-dedicated frac market [7] - The acquisition of Pentel is expected to increase the company's concentration in the Permian Basin to approximately 60% of total revenues [15] Company Strategy and Development Direction - The company aims to bolster less capital-intensive service lines through organic investments and acquisitions to drive growth and reduce volatility [10] - The strategic rationale for the Pentel acquisition includes improving margins, increasing operational scale, and focusing on high cash flow-generating service lines [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about macro uncertainties driven by tariffs and their potential impact on inflation and equipment prices [25] - The company remains confident in its strong balance sheet and liquidity to navigate volatility and capitalize on opportunities [27] Other Important Information - The company has filed an S-3 registration statement with the SEC regarding the Rollins family control group shares, which is viewed as good corporate housekeeping [24] - The management team remains focused on maintaining operational stability and long-term shareholder returns [28] Q&A Session Summary Question: What are the current pricing conversations in the pressure pumping market? - Management indicated that while discussions are similar to prior periods, the current circumstances may impact these discussions due to lower oil prices and customer responses [35][37] Question: What are the capital allocation priorities following the Pentel acquisition? - The focus is on accretive transactions, exposure to larger customers, and service lines with good free cash flow potential [38][39] Question: What is the expected revenue for the Pentel business? - Pentel generated approximately $400 million in revenue in 2024, with each quarter around $100 million [40] Question: Are there shifts in customer activity towards lower CapEx projects? - Management noted it is early to determine any significant shifts but acknowledged that such trends have occurred in prior cycles [45] Question: What is the visibility on job timelines for fracking? - Visibility varies by customer type, with semi-dedicated customers providing several months of visibility, while spot market customers offer much less [46][48] Question: Is the company considering selling any assets? - Management stated they monitor equipment closely and prefer to reallocate assets rather than sell them, ensuring they do not re-enter the competitive market [55][57] Question: What would trigger an acceleration in capital expenditures? - Capital expenditures will be based on market conditions and the need to maintain equipment, with potential for increased spending if accretive opportunities arise [58][60] Question: Is the company focused on consolidating the Permian market or open to other basins? - Management is open to opportunities in various basins, not just the Permian, and is exploring potential acquisitions in natural gas basins as well [62][63]

Financial Data and Key Metrics Changes - Revenues decreased by 1% to $333 million in the first quarter compared to the fourth quarter of 2024 [18] - EBITDA increased to $48.9 million from $46.1 million, with EBITDA margin rising by 100 basis points to 14.7% [22] - Diluted EPS remained flat at $0.06 [22] - Operating cash flow was $39.9 million, with free cash flow of $7.6 million after capital expenditures of $32.3 million [22] Business Line Data and Key Metrics Changes - Pressure pumping revenues accounted for 40.1% of total revenues, while downhole tools represented 28.2%, coiled tubing 9.6%, cementing 8.3%, and rental tools 4.6% [19] - Pressure pumping revenues were flat sequentially, while other service lines collectively declined by 1% [6][18] - Rental tools saw a notable gain of approximately 7% [11] Market Data and Key Metrics Changes - The company noted challenges in demand and utilization for Tier two diesel equipment, with a highly competitive pricing environment in the spot and semi-dedicated frac market [7] - The acquisition of Pentel is expected to increase the company's concentration in the Permian Basin to approximately 60% of total revenues [16] Company Strategy and Development Direction - The company aims to bolster less capital-intensive service lines through organic investments and acquisitions to drive growth and reduce volatility [11] - The strategic rationale for the Pentel acquisition includes improving margins, optimizing assets, and increasing operational scale through M&A [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about macro uncertainties driven by tariffs, which could impact equipment prices and overall industry capital spending [27] - Despite the challenges, the company maintains a strong balance sheet and ample liquidity to navigate volatility and pursue opportunities [28] Other Important Information - The company has filed an S-3 registration statement with the SEC for the Rollins family control group shares, which is viewed as good corporate housekeeping [25] - Steve Lewis has been elected to the Board of Directors, while Gary Rollins and Pam Rollins have retired [29] Q&A Session Summary Question: What are the current pricing conversations in the pressure pumping market? - Management noted that while each cycle is different, customers are responding to lower oil prices, leading to discussions that are somewhat similar to prior periods of market softness [37][38] Question: What are the capital allocation priorities following the Pentel acquisition? - The focus is on accretive transactions, exposure to larger customers, and service lines with good free cash flow potential [39][40] Question: What is the expected revenue contribution from the Pentel business? - Pentel generated approximately $400 million in revenue in 2024, with quarterly revenues around $100 million [41] Question: Are there shifts in customer activity towards lower CapEx projects? - Management indicated it is too early to determine any significant shifts but acknowledged that such trends have occurred in prior cycles [46] Question: What is the visibility on job timelines for fracking? - Visibility varies by customer type, with semi-dedicated customers providing several months of visibility, while spot market customers offer much less [48] Question: Is there an uptick in gas-directed activity? - Management believes any increase in gas-directed activity is likely further down the road, although there are some early signs [51] Question: What are the company's thoughts on older equipment being sold by competitors? - The company has seen opportunities but prefers not to invest in used equipment, focusing instead on reallocating assets within its service lines [58] Question: What would trigger an acceleration in capital expenditures? - Capital expenditures will be based on market conditions and the need to maintain equipment, with potential for increased spending if accretive opportunities arise [60][62] Question: Is the company focused on consolidating the Permian market or open to other basins? - Management is open to opportunities in other basins, not solely focused on the Permian, and is exploring various potential acquisitions [64][65]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $53.2 million, a 33% sequential increase from $40 million in Q3 2024 [21] - Full year 2024 total revenue was $187.9 million, down from $309.5 million in 2023, primarily due to decreased utilization in well completion services [21][22] - Net loss for Q4 2024 was $15.5 million, or a loss of $0.32 per diluted share, while the full year net loss was $207.3 million, or a loss of $4.31 per diluted share [27] - Adjusted EBITDA for Q4 2024 was a negative $4.8 million, improving from a negative $6.4 million in Q3 2024 [28] Business Line Data and Key Metrics Changes - Infrastructure services revenue for Q4 2024 was $27.9 million, slightly up from $26 million in Q3 2024, with full year revenue flat at $110.4 million compared to $110.5 million in 2023 [23] - Well completion services generated $15.8 million in Q4 2024, with an average of 1.1 fleets utilized [25] - Sand division sold 129,000 tons of sand in Q4 2024 at an average price of $22.54 per ton, down from 163,000 tons at $22.89 in Q3 2024 [26] Market Data and Key Metrics Changes - The company noted improved pressure pumping utilization and strong demand across various businesses, including engineering, fiber, and T&D services [10] - There are significant bidding opportunities in the market related to engineering fiber transmission and distribution [14] Company Strategy and Development Direction - The company aims to unlock value for shareholders while maintaining a strong balance sheet and evaluating strategic opportunities for accretive assets [11][12] - Strategic investments are being made to add equipment and crews in response to growing utility demand [15] - The focus for 2025 includes organic growth, particularly in infrastructure services, with potential for acquisitions if beneficial [38] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about demand implications for natural gas driven by LNG export capacity and electricity demand [22] - The company expects steady completions activity in 2025 with potential upside from natural gas demand [17] - Management emphasized disciplined capital stewardship and alignment of spending with customer demand [26] Other Important Information - The company had unrestricted cash of $61 million as of December 31, 2024, with total liquidity remaining strong and debt-free [32] - CapEx for Q4 2024 was approximately $6.1 million, with a budget of $12 million for 2025 focused on growth and maintenance [29] Q&A Session Summary Question: Where is the best growth potential for the infrastructure business? - Management indicated that most growth is currently organic, with increased demand from larger IOUs and potential for co-op involvement [38] Question: Can you provide details on the rental business and its growth drivers? - The rental business primarily serves E&P companies, with opportunities in the construction market and a broad portfolio of assets including helicopters [42] Question: What is the outlook for the sand business in 2025? - Management noted stabilized demand and the ability to expand capacity as key drivers for growth in the sand business [44] Question: Can you break down the CapEx outlook for 2025? - Approximately half of the $12 million CapEx budget is allocated to growing the rental business, with about $5 million for pressure pumping upgrades [46] Question: What are the primary focuses for the company moving forward? - The focus includes rightsizing the company, evaluating existing businesses, and exploring potential acquisitions now that the company has cash available [48]