TETRA (NYSE:TTI) 2025 Investor Day Transcript

TETRA Technologies Investor Day Summary Company Overview - Company: TETRA Technologies (NYSE: TTI) - Event: 2025 Investor Day held on September 25, 2025 - Focus: Transformation strategy named "OneTETRA 2030" aimed at enhancing operational excellence and financial strength to deliver long-term value [2][4][22] Key Industry Insights - Current Revenue Breakdown: - 71% from traditional oilfield services - 23% from industrial chemicals (primarily calcium chloride) - 6% from water treatment and recycling for frac reuse [6][8] - Future Revenue Goals: - Projected growth from over $600 million to approximately $1.25 billion by 2030 - Revenue distribution expected to be 36% from energy services, 36% from specialty chemicals and minerals, and 28% from water treatment and desalination [8][20] Financial Performance - Historical Growth: - Revenue increased by 56% - EBITDA increased by 129% - Cash flow from operations increased by 544% since 2021 [14][15] - Share Price Appreciation: Nearly 440% since the announcement of the new strategy in January 2021 [13] Strategic Transformation - Divestiture: The divestiture of the general partnership in CSI Compresco in early 2021 marked the beginning of the transformation [5][10] - Core Competencies: Focus on fluid chemistry, particularly in electrolytes for energy storage, desalination of produced water, and critical minerals from brine leases [11][19] - Investment Focus: Directing free cash flow towards key investment enablers, including R&D and vertical integration of bromine supply [9][10] New Business Segments - Future Reporting Segments: - Energy Services - Specialty Chemicals and Minerals - Water Treatment and Desalination [16][18] - Specialty Chemicals and Minerals: Expected to grow to over $400 million in revenue with EBITDA margins consistent with current segments [20] Market Positioning - Deep Water Market: - Strong pipeline of opportunities in deep water completion fluids, particularly with the introduction of 20K rigs [48][59] - TETRA is positioned to benefit from the increasing demand for high-density fluids in technically challenging environments [56][60] - International Presence: Active in key markets including the Gulf of America, Brazil, and the North Sea, with a focus on expanding operations in the Middle East and Argentina [11][42][45] Innovation and Technology - Automation: Introduction of automated solutions for drill-out operations and sand management, leading to higher margins and reduced operational risks [31][34] - Neptune Fluids: Development of a family of fluids that are non-corrosive and environmentally friendly, generating over $150 million in revenue since launch [63] Future Outlook - Growth Projections: - Energy services expected to grow at a steady 5% to 8% CAGR through the end of the decade [20] - Water treatment and desalination targeting 500,000 barrels a day of produced water desalination by 2030 [20] - Market Dynamics: Despite current declines in U.S. drilling activity, TETRA is positioned to capture market share through innovation and efficiency improvements [37][39] Conclusion - TETRA Technologies is on a transformative journey aimed at leveraging its core competencies in fluid chemistry to capture significant growth opportunities in the energy services, specialty chemicals, and water treatment sectors, with a strong focus on innovation and operational excellence [22][23]