Mammoth Energy Services, Inc.

Greetings and welcome to Mammoth Energy Services second quarter earnings conference call. At this time, all participants are in a listen only mode. A 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. I would now like to turn the conference over to your host, Ken Dennard, Investor Relations.

Thank you, operator. Good afternoon, everyone. We appreciate you joining us for the Mammoth Energy conference call to review 2022 second quarter results. This call is also being webcast. It can be accessed through the audio link on the events and presentation page. of the investor relations section at www.mammothenergy.com. Information reported on this call speaks only as of today, July 28, 2022. So please be advised that any time-sensitive information may no longer be accurate as of the date of any replay listening or transcript reading. I would also like to remind you that statements made in today's discussion that are not historical facts, including statements of expectations of future events or future financial performance, are forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. We will be making forward-looking statements as part of today's call and that by their nature are uncertain and outside of the company's control. Actual results may differ materially. Please refer to the earnings release that was issued today for our disclosure on forward-looking statements. These factors and other risks and uncertainties are described in detail in the company's filings with the Securities and Exchange Commission. Management may also refer to non-GAAP measures, including adjusted net income or loss and adjusted EBITDA. Definitions of these non-GAAP measures and their reconciliation to the nearest GAAP measures can be found at the end of the earnings release and in the investor presentation, which can be found on the website. Mammoth Energy assumes no obligation to publicly update or revise any forward-looking statements. And now with that behind me, I'd like to turn the call over to Mammoth Energy CEO, Artie Strehler. Artie. Thank you, Ken.

And good afternoon, everyone. I'll begin with a review of the second quarter, followed by an overview of our businesses before turning the call over to Mark to review our financials in more detail. We are pleased with our second quarter results and the performance of each of our business segments. In addition, we believe that the trend lines look very positive for our business across the board as we enter the second half of 2022 and extending into 2023. Overall second quarter results marked significant improvement and we believe serve as a notable inflection point for Mammoth. Total revenue was 89.7 million, up 44% sequentially from our 2022 first quarter revenue. Net income was 1.7 million, a major positive swing compared to the net loss of 14.8 million we reported in the first quarter of 2022. And our second quarter adjusted EBITDA was 23 million. a sequential increase of 147% compared to 9.3 million for the first quarter of 2022. Our robust second quarter growth in revenue, net income, and adjusted EBITDA resulted from substantial gains in our infrastructure services, well completion services, and our sand business. Looking at our infrastructure services segment, we continue to grow and build upon our positive momentum in the first half of 2022, after becoming cash flow positive exiting 2021. Since the first quarter, we've been adding crews. Currently, we have more than 100 crews, and we expect to add additional crews in the coming weeks in preparation for the seasonal storm restoration services anticipated in the third and fourth quarters. The overall infrastructure backdrop remains strong, and we believe the passage of the Federal Infrastructure Bill last fall will provide opportunities in the infrastructure space for years to come. As we have said previously, we anticipate the federal spending to begin stimulating project lettings across the sector later this year and into 2023. I'm proud of our infrastructure team's commitment and hard work to mitigate the myriad of headwinds in today's challenging economic environment as we remain disciplined with our capital spending to continue to improve MAMIS cost structure. Moving to our well completion services segment, We posted the strongest quarter we've seen since mid-2019, resulting from the robust macro demand that the pressure pumping industry is experiencing. We currently have four pressure pumping fleets operating, which have full schedules through the end of the year, and we expect to activate a fifth fleet in the fourth quarter. Looking to 2023, we plan to activate our sixth fleet in the first quarter of 2023, and we have plans to acquire or build a new tier four dual fuel system in 2023. We anticipate operating seven pressure pumping fleets by the end of 2023. At today's pricing, we would expect seven operating fleets to generate between $63 million and $84 million in net income per year and between $105 million and $126 million in EBITDA per year. Our sand business is also experiencing strong demand as well as increased pricing. which we believe will continue to improve in the back half of the year and into 2023. Mark will provide details on our increasing tonnage produced and improving pricing metrics. I am very proud of our entire mammoth team's continued commitment and hard work to push through the challenges we have faced over the last few years and am confident that we are well equipped to build on the improvements we have made this quarter. We believe our diverse portfolio and ability to adapt quickly to changing environments positions us well in these segments. Moving forward, we continue to see improved macroeconomic trends that we believe will drive increased demand. Turning now to an update on PREPA. We continue our efforts to hold PREPA accountable for their contractual and financial obligations. Both FEMA and the Financial Oversight and Management Board for Puerto Rico have roles to play, and we continue our efforts to hold both of them accountable as well. The implications of this ongoing delay are enormous for both the people of Puerto Rico as well as the unsecured creditors of PREPA. Interest piles up on the unpaid bills at more than $3.5 million. dollars each month and our PREPA receivable now stands at 358 million dollars. We are working diligently with congressional leaders to reach a fair resolution and we remain confident that the successful work we performed during a time of crisis and national disaster recovery should be and will be paid to the company. Now let me turn the call over to Mark to take you through MAMMA's financial performance during the second quarter before we open the call to questions.