Mammoth Energy Services(US:TUSK)2021-07-30 17:27Financial Data and Key Metrics Changes - Mammoth Energy's revenue for Q2 2021 was $47.4 million, down from $60.1 million in the same quarter last year and $66.8 million in Q1 2021, primarily due to decreased infrastructure revenue caused by management and crew turnover [20] - The net loss for Q2 2021 was $34.8 million, or $0.75 per share, compared to a net loss of $15.2 million, or $0.33 per share, in Q2 2020 and a net loss of $12.4 million, or $0.27 per share, in Q1 2021 [21] - Adjusted EBITDA for Q2 2021 was negative $5.5 million, down from $6.9 million in Q2 2020 and $6.4 million in Q1 2021 [21] - As of June 30, 2021, the company had approximately $11 million in cash and $64 million in debt, with a reduction in long-term debt from $81 million at the end of 2020 to $62.8 million [21][33] Business Line Data and Key Metrics Changes - The oilfield services segment saw some positive signs with increased pricing and utilization, although overall activity levels remained depressed due to capital discipline among exploration and production companies [6] - The infrastructure business underperformed in Q2 2021 due to management crew turnover, but there are ongoing bidding activities and expectations for improved performance in Q3 [9][20] - The sand division sold approximately 255,000 tons of sand at an average price of $15.80 per ton during Q2 2021, with expectations for increased market activity in the second half of 2021 [7][8] Market Data and Key Metrics Changes - The company is experiencing increased project bidding levels and funding capacity in the infrastructure sector, with robust bidding levels expected to continue [9][10] - The infrastructure segment is expected to benefit from the anticipated federal Infrastructure Bill, which could further enhance growth opportunities [9][10] Company Strategy and Development Direction - The company is shifting towards a broader industrial focus, particularly in the infrastructure space, to enhance long-term growth and sustainability [5] - Mammoth Energy is expanding its engineering group and has entered the fiber optic market, which is seen as a significant growth opportunity [11][12] - The company aims to vertically integrate its services and equipment manufacturing capabilities to differentiate itself in a competitive landscape [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that Q2 results did not meet expectations but expressed confidence in the company's ability to improve near-term results and adapt to changing market conditions [5][8] - There is optimism regarding the recovery in the oilfield services sector, with expectations for increased activity and improved pricing [6][28] - Management is actively pursuing the collection of outstanding receivables from PREPA in Puerto Rico, with ongoing discussions and support from Congressional members [13][18][33] Other Important Information - The company has signed two significant multiyear contracts with major utilities in the infrastructure space, which are expected to provide a stable base of business [10] - As of June 30, 2021, PREPA owed the company approximately $319 million for services performed, including $227 million in receivables and $92 million in interest [16] Q&A Session Summary Question: Can you talk about the path to repair in the infrastructure segment? - Management noted ongoing bidding activity and integration with engineering offerings, indicating a positive outlook for Q3 despite challenges in restoring profitability [27][28] Question: What are the challenges of ramping up and maintaining personnel? - Management indicated that staffing for frac crews has been relatively easier, but labor shortages remain a concern across the industry [29][30] Question: What is the status of the PREPA receivable? - Management emphasized the importance of the $300 million receivable and noted intensified discussions with PREPA, indicating a strong position as a post-bankruptcy creditor [33]