Mammoth Energy Services, Inc.

Greetings and welcome to the Mammoth Energy Services first 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, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Mohamed Totawala with Vizara Investor Relations. Thank you. You may begin.

Thank you, Operator, and good morning, everyone. We appreciate you joining us for Mammoth's first quarter 2026 earnings conference call. Joining us on the call today are Mark Leighton, Chief Financial Officer, and Bernine Lancaster, Chief Operating Officer. We will start today with our prepared remarks and then open it up for questions. I want to remind everyone that some of today's comments include forward-looking statements, These statements are subject to many risks and uncertainties that could cause our actual results to differ materially from any expectation expressed herein. Please refer to our latest Securities and Exchange Commission filings for risk factors and cautions regarding forward-looking statements. Our comments today also include non-GAAP financial measures. The underlying details and a reconciliation of GAAP to non-GAAP financial measures are included in our first quarter earnings press release, which can be found on our website. As a reminder, today's call is being webcast, and a recorded version will be available on the investor relations section of Mammoth's website following the conclusion of this call. With that, I'll turn the call over to Mark.

Thank you, Mohamed, and good morning, everyone. I'll cover first quarter results and the key themes driving the quarter's performance, then turn it over to Bernie Lancaster, our Chief Operating Officer, to walk through operational performance by segment. I'll then come back to cover the financials, capital allocation, and our updated outlook for 2026, after which we'll open the line for questions. The first quarter of 2026 represents a clear inflection point for Mammoth. When we last spoke in March, we were direct about where the fourth quarter fell short. The demand was there, but our execution and cost control did not meet our expectations, and we owned that. We took targeted action, and the first quarter is early proof that those actions are working. Revenue was $22 million, up 90% year over year and 133% sequentially. Adjusted EBITDA was positive 1.9 million, our first positive EBITDA quarter in eight quarters. The momentum we are seeing across the platform is strong enough that we are now raising our 2026 guidance on both revenue and EBITDA. I'll walk through the specifics later in the call. During the first quarter and for the first time since our share repurchase program was authorized in August 2023, we began returning capital directly to shareholders, a reflection of our confidence and where this business is headed. Stepping back, the pivot we spent the last several quarters executing, simplifying the portfolio, redeploying capital into higher return businesses, and rebuilding the cost structure to match the size and shape of the company we are today is now showing up in the numbers. There's more work ahead, and I'll be specific about where later in the call. As reflected in the first quarter results, we are seeing early measurable proof points across multiple parts of the business that the strategy is working. Starting with revenue, growth was led by our rental segment, particularly aviation, where we benefited from a full quarter of utilization on assets deployed throughout 2025. In addition to the improved utilization, During the quarter, we sold an aviation APU that we had purchased only two quarters earlier in the third quarter of 2025, generating a gross IRR of approximately 20%. We then redeployed the proceeds into another aviation asset where we see a strong return profile. As we said on our last call, there are assets on our balance sheet that carry value not reflected in where the stock trades. This transaction is a real-time data point on exactly that, and it reinforces the capital allocation philosophy we've articulated since we entered this business. Beyond rentals, we saw improvement across several other segments. Drilling revenue increased over 180% sequentially. Fan revenue increased over 129% sequentially. And accommodations delivered another strong quarter. with revenue up 25% sequentially. The improvement in profitability was driven by a combination of higher revenue fall through, particularly in rentals and accommodations, along with continued discipline on the cost structure, with SG&A of 3.6 million, a 38% decrease sequentially. Putting SG&A into longer perspective, We have taken our SG&A run rate from approximately $25 million in 2024 to $20 million in 2025, and we now have line of sight to an annual run rate of approximately $11 to $12 million as the work on structural costs continues to take hold. Cost trajectory is the result of deliberate work, sharing services more efficiently across the platform, and maintaining strict discipline on spend. In accommodations specifically, we generated gross margins of approximately 40%, the highest level in the past five quarters, reflecting both improved utilization and the operating leverage that comes with it. While we are encouraged by the progress, there are still areas where we see meaningful opportunities for improvement. In drilling, revenue improved significantly versus the fourth quarter, However, margins were pressured by higher operating costs, with a portion of these being front-loaded in nature, particularly on the maintenance side. As context, drilling delivered the highest gross margin in the segment's history in the third quarter of 2025, before timing-related items affected the fourth. First quarter saw activity rebound on that base, with utilization building, costs normalizing, and planned capital deployment improving our operating efficiency, we expect margins to expand through the year and the segment to reach EBITDA positive in 2026. In SAND, while volumes and revenue improve meaningfully, margins remain below our expectations. This business is leveraged to activity in the monotony, and we expect performance to track with that market. Our internal focus continues to be on operational efficiency and pricing capture as activity increases. In infrastructure, demand, particularly for fiber, remains intact. The new leadership team we put in place is making progress, and as the operational changes take hold, we expect financial performance to improve. This is our smallest segment today, but one where we see meaningful long-term potential. What we are starting to see now are real proof points that the transformation strategy is working. A more focused portfolio, improving utilization, better capital allocation, and a cost structure aligned with the current scale of the business. With that, I'll turn it over to Bernie to walk through the operational performance in more detail.