Mammoth Energy Services, Inc.

Good day, ladies and gentlemen, and welcome to the Mammoth Energy Services First Quarter 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. As a reminder, this conference call is being recorded and will be available for replay on Mammoth Energy Services' website. I would now like to introduce your host for today's conference, Mr. Don Christ, Mammoth Energy Services Director of Investor Relations. Sir, you may begin.

Thank you, Anne. Good afternoon, and welcome to Mammoth Energy Services' first quarter 2021 earnings conference call. Joining me on today's call are Artie Strayla, Chief Executive Officer, and Mark Layton, Chief Financial Officer. Before I turn the call over to them, I'd like to read our safe harbor statement. Some of our comments today may include forward-looking statements reflecting Mammoth Energy Services' views about future events. These matters involve risks and uncertainties that could cause our actual results to materially differ from our forward-looking statements. These risks are discussed in Mammoth Energy Services Form 10-K, Forms 10-Q, current reports on Form 8-K, and other Securing and Exchange Commission filings. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Our comments today may also include non-GAAP financial measures. Additional details and reconciliations to the most directly comparable GAAP financial measures are included in our first quarter 2021 press release, which can be found on our website, along with an updated presentation. Now, I'll turn the call over to Artie.

Thank you, Don, and good afternoon, everyone. The first quarter of 2021 came in as expected, as restoration work was completed on the Gulf Coast and infrastructure work moderated slightly. Since the start of the year, we have seen a significant ramp up in the bidding activity across the infrastructure space as the new administration set its renewable agenda and announced an infrastructure bill to rebuild a broad array of the nation's infrastructure assets. The roughly $2 trillion plan, which is making its way through Congress, includes several areas in which our teams have expertise, including the modernization of the electric grid and the shift to renewables. In addition to the recent policy announcements, the extension of the renewable and electric vehicle investment tax credits has resulted in an increase in activity levels across electrical infrastructure space. These policy extensions have added work to our industry, which is undergoing a significant rebuilding and hardening effort to make the grid more reliable. As it relates to Mammoth, we have signed two significant multi-year contracts with major utilities over the past several months, which we expect will provide a base of business, and in the case of our engineering company, allow for an expansion of projects engineered. As industry activity has increased, our bidding opportunities have increased, and we believe that our backlog will grow over the coming quarters. Our infrastructure management team has an impressive resume of construction and renewable projects, and we believe that their background combined with our vertically integrated service offering positions us well to compete and win renewable projects. AquaWolf, our engineering business, has seen a ramp up in revenue and projects following the recent signing of a multi-year contract with a major utility. We currently anticipate AquaWolf to grow over the coming months as additional jobs are assigned to them. In addition, AquaWolf continues to work closely with our infrastructure segment to jointly bid projects as we progress towards being an engineering procurement, and construction, or EPC company. The integration of our manufacturing operation into our infrastructure offering is progressing through the manufacturing refurbishment of equipment and products used by our infrastructure teams. We are encouraged by what our infrastructure engineering and manufacturing teams have accomplished and what the future holds. Turning to the oil field, while oil prices have rebounded from recent lows, activity levels remain depressed industry-wide. as a result of capital discipline amongst E&Ps. We currently believe E&Ps will generally keep production flat with year-end 2020 levels, and that pricing utilization for our oilfield services are expected to remain constant for the foreseeable future. During the first quarter of 2021, we pumped 445 stages with approximately one fleet utilized throughout the quarter on average. We have continued to upgrade additional pumps to dynamic gas blending, or DGB to meet current and anticipated industry demand. Our sand division sold approximately 171,000 tons of sand during the first quarter of 2021. The average sales price for the sand sold during the first quarter of 2021 was approximately $16.83 per ton. While northern white sand pricing remains challenged, we believe a significant reduction in supply has positioned our mines to benefit from an increase in completion activity levels. While the events of the past year have caused significant impacts on both our daily and professional lives, Mammoth has adapted quickly to the changing environment. Our diverse portfolio of businesses across several industries has performed as expected. The infrastructure business has a solid foundation from which to grow as it looks to further integrate into our other businesses and continue to lower costs. Before I turn the call over to Mark to take you through the numbers, let me give you an update on Puerto Rico. While I can't get into all the details, on April 6, 2021, COBRA filed a motion to lift the stay order on our administrative claim in the bankruptcy court. Following this filing, PREPA initiated discussions, which resulted in both PREPA and COBRA filing a joint motion. This motion adjourns all deadlines relative to the April 6, 2021 motion until the June 16, 2021 omnibus hearing as a result of PREPA's understanding that FEMA will release a report in the near future relating to the Emergency Master Service Agreement between PREPA and COBRA that was executed on October 19, 2017. We believe that this report will provide another affirmation that COBRA performed its work in Puerto Rico at a reasonable cost. As a reminder, we have made public two memorandums from FEMA as well as the report from the RAND Corporation, all of which state that the contract was obtained properly and our costs were reasonable. All of these documents can be found on our website. As of March 31, 2021, PREPA owes us $227 million for services performed and $83 million in interest for approximately $310 million. Let me turn the call over to Mark to take you through the financial performance during the first quarter of 2021, after which we will take questions.