ProFrac Holding Corp.

Greetings and welcome to the ProFact Holding Corp First Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Messina. Senior Vice President of Finance. Thank you, sir. You may begin.

Thank you, Operator. Good morning, everyone. We appreciate you joining us for Profract Holding Corp's conference call and webcast to review our results for the first quarter ended March 31st, 2026. With me today are Matt Wilkes, Executive Chairman, Ladd Wilkes, Chief Executive Officer, and Austin Harbour, Chief Financial Officer. Following my remarks, management will provide high-level commentary on the operational and financial highlights of the first quarter of 2026 before opening up the call to your questions. A replay of today's call will be available by webcast on the company's website at pfholdingscorp.com. More information on how to access the replay is included in the company's earnings release. Please note that the information reported on this call speaks only as of today, May 7, 2026. Your advice on any time-sensitive information may no longer be accurate as of the time of any replay listening or transcript reading. Also, comments on this call may contain forward-looking statements within the meaning of the United States federal securities laws, including management's expectations of future financial and business performance. These forward-looking statements reflect the current views of ProFRAC management and are not guarantees of future performance. Various risks, uncertainties, and contingencies could cause actual results, performance, or achievements to differ materially from those expressed in management's forward-looking statements. Listener or reader is encouraged to read ProFRAC's Form 10-K and other filings with the Securities and Exchange Commission, which can be found at sec.gov or on the company's investor relations website section under the SEC filings tab to better understand those risks, uncertainties, and contingencies. The comments today also include certain non-GAAP financial measures, as well as other adjusted figures to exclude the contribution of GLOTEC. Additional details and reconciliations to the most directly comparable consolidated and GAAP financial measures are included in the earnings press release which can be found on the company's website. Now, over to Mr. Matt Wilts, Executive Chairman.

Thanks, Michael, and good morning, everyone. I'll begin with some brief remarks on our overall performance, the broader market environment, and the progress of our strategic priorities. Ladd will then take you through our business results in more detail, followed by Austin, who will walk through the financials. We're pleased to report that our first quarter results exceeded our expectations. that we discussed in March. Our exceptional operational performance as we progressed through the final month of the period drove out performance for Q1 relative to some weather-driven challenges we faced to start the year. Specifically, as we discussed on our Q4 call, harsh winter conditions across much of our operating areas created some operational disruptions that resulted in approximately 9 million of adjusted EBITDA impact. More importantly, Market dynamics shifted meaningfully beginning in late February and early March with the onset of the Mideast conflict. Initially, activity accelerated through the end of Q1, characterized by calendar tightening and a reduction in white space. More recently, we've begun to see work added to the calendar that was not scheduled prior to the Iranian conflict. Further, we're proud to note that our Stimulation Services team delivered record efficiency levels in March, with operational momentum carrying into the second quarter. As a near-term solution to oil supplies remaining elusive, exacerbating a material increase in oil prices, operator sentiment has continued to improve. Against the positive market trajectory, we're witnessing an open window for more favorable pricing dynamics. We are aware that pricing discussions are happening across the energy value chain, and our customers are highly engaged. We have taken a measured, deliberate approach focused on partnering with operators that will collaborate with us to generate appropriate returns through the cycle. We have successfully implemented price increases for the majority of our active fleets. These increases layer in throughout the latter half of the second quarter and into the back half of the year. Based on these factors, we expect Q2 to trend higher sequentially. LADD will provide more color in a few minutes. Stepping back to the broader market environment, what we're experiencing at the company level reflects a larger set of dynamics we believe are still in the early innings of North American energy services. We believe the geopolitical developments that emerged in late February have fundamentally altered the global energy security of supply calculus. Beyond the immediate disruption to tanker traffic via the closure of the Strait of Hormuz, what's becoming increasingly apparent is the scale of damage to critical Persian Gulf infrastructure. The processing facilities, export terminals, and distribution networks that were impacted represents decades of engineering and capital investment. Reconstruction timelines are becoming clearer, and they could be measured in years, not quarters. This isn't a transient supply shock. We believe it is a shift in available global capacity that will take considerable time to resolve. Further, this supply constraint is coinciding with a policy environment in Washington that increasingly appears to be pivoting decisively toward domestic energy security and infrastructure development. While it's early to predict specific legislative outcomes, the direction is clear, and it reinforces the case for a sustained call on North American production activity. Energy security has also become a more prevalent factor globally. As importers revise their strategies regarding consistent reliable access to hydrocarbons at scale, we believe these dynamics provide increased structural tailwinds to the North American energy industry as the lowest risk producer of crude oil and LNG. Overlaying these macro developments is a North American supply-demand picture that was already tightening. The production gap we flagged for several quarters has only widened, with operators running behind the activity curve required to offset natural decline. Meanwhile, on the gas side, the convergence of expanding LNG export capacity with accelerating power demand from data centers and industrial electrification is creating increased medium and long-term demand. On the service side, the available capacity supply response has been notably restrained. Years of capital discipline has limited new equipment from entering the market, while the natural attrition of aging fleets continues to reduce available capacity. The result is a tightening supply demand balance for high specification, high efficiency service capacity coinciding with an inflection in operator activity. Our record efficiency performance in March reflects this evolution as we delivered a company record measured by pump hours per fleet. Our vertical integration model, dual fuel and electric fleet capabilities, and asset management platform position us to continue to enhance service quality and efficiency. We're focused on delivering value where operator demand is strongest, maintaining our disciplined approach to fleet deployments, and leveraging the technology differentiation that Ladd will discuss in more detail. I'd like to spend some time discussing our approach to asset deployment. Of note, irrespective of market cycles, we execute a routine program upgrading diesel to dual fuel or natural gas capable configurations. In the current market environment, as the call on equipment continues to increase, we have fielded a number of inbounds from operators seeking incremental assets, and crews. In order to deploy additional assets, we would need to accelerate our upgrade program, and to do so, we have certain requirements that must be met. We will remain disciplined in our approach to capital allocation and fleet deployment. Importantly, our vertical integrated model and asset management capabilities uniquely enable us to respond rapidly to evolving market conditions. As we discuss future activity with customers, the dialogue remains constructive. Safe to say, there are numerous factors in play that bodes well not only for an improved Q2, but an improved second half of the year and potentially beyond. While we're encouraged by the macro backdrop and the tightening we're seeing in the market, what ultimately positions us to capitalize on these dynamics is the work we've been doing internally to strengthen our cost structure and improve our operational efficiency. On our last call in March, we outlined our business optimization program and I am pleased to report significant progress towards our goal. On a year-over-year basis, and including our capital expenditure reduction in the fourth quarter of 2025, we've achieved the majority of our $100 million annualized savings target. Our labor-related cost reductions have been fully implemented and are running at an annualized savings rate at or above the midpoint of our $35 to $45 million target range. On non-labor operating expenses, SG&A reductions have been implemented. Additionally, we continue to make progress on repair and maintenance and asset-level operating expense reductions. While some of our projects remain in earlier stages of implementation, they should accelerate as we move through the year. We continue to expect to achieve the full $30 to $40 million range as these initiatives mature through the year. On capital expenditure efficiencies, we have already achieved at a minimum, and including the reduction in the fourth quarter of 2025, the high end of our targeted range of $20 to $30 million. One element worth highlighting is our transition to internally designed, developed, and commercialized e-blenders. Ladd will elaborate on this in his remarks. Taken together, these actions meaningfully improve our cost structure and position Profract to generate stronger returns through the cycle. Our internal execution on costs and capital efficiency is what keeps us competitive through the cycle. But competing effectively over the long term also requires technology that creates value that our customers cannot find elsewhere. And that brings me to Machina. On our last call, we introduced Machina in considerable detail as a unified completion optimization platform, combining ProPILOT 2.0 surface automation with seismos subsurface intelligence. In summary, Machina is Profract's integrated well optimization suite that brings pre-stage design, field execution, post-stage diagnostics, and historical analysis into a cutting-edge, real-time, unified feedback control framework that actively intervened to increase perforation performance by up to 33%. What I want to share is where things stand and the dimension the opportunity that has come into sharper focus as we have been in front of customers. The headline is that we are an active price discovery on the commercial model. Customer feedback from testing stage deployments has been encouraging, and that feedback is informing us of how we think about structuring the value share. We will have more to say as this process matures. What has become increasingly clear through those customer conversations is that Machina's most compelling application may be an unlocking acreage that operators have effectively set aside. A portion of stranded inventory may be uneconomic due to complications in frac design impacted by existing adjacent infrastructure. Offset wells, wastewater infrastructure, and legacy downhole completions can collectively create constraints that may force operators to conclude that fewer locations are economic to produce. Machina may address this issue directly. Lad will explain what that looks like on location, but the strategic point is this. We believe this platform has the potential to bring previously stranded inventory back into play for our customers. To conclude my opening comments, We delivered a strong Q1, exceeding our expectations. Despite a weather impacted start, the business performed well with increased completions momentum through the end of the quarter. Our cost optimization program continues to advance. We have achieved the majority of our $100 million run rate target. The macro backdrop is working in our favor. Energy security has moved to the front of the conversation. And that has direct and tangible implications for domestic completions activity and the operators we serve. Machina. Our complete well optimization suite is gaining traction in the market with more customers inquiring about its closed-loop well optimization capabilities. As a continuous improvement engine, Machina may potentially offer operators the ability to economically complete stranded locations. And finally, Q2 is shaping up to be a meaningful step forward. Some operators are pulling work forward, helping to eliminate white space and black calendars. The market is tightened, and we see it tightening more as the year unfolds. With natural gas burning equipment nearly sold out, we are in active discussions with customers and have achieved price increases on the majority of our fleets. Discussions with operators remain active, and we will remain disciplined on fleet deployments. Let me now turn it over to Ladd, who will get into the operational details.