ProPetro Holding Corp.

Good day and welcome to the ProPretro second quarter 2023 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference over to Matt Augustine, Director of Corporate Development and Investor Relations. Please go ahead.

Thank you, and good morning. We appreciate your participation in today's call. With me today is Chief Executive Officer Sam Sledge, Chief Financial Officer David Shorlimer, and President and Chief Operating Officer Adam Munoz. This morning, we released our earnings results for the second quarter of 2023. Please note that any comments we make on today's call regarding projections or our expectations for future events are forward-looking statements covered by the Private Securities Litigation Reform Act. Forward-looking statements are subject to several risks and uncertainties, many of which are beyond our control. These risks and uncertainties can cause actual results to differ materially from our current expectations. We advise listeners to review our earnings release and risk factors discussed in our filings with the SEC. Also during today's call, we will reference certain non-GAAP financial measures. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in our earnings release. Finally, after our prepared remarks, we will hold a question and answer session. With that, I would like to turn the call over to Sam.

Thanks, Matt, and good morning, everyone. Building on our strong momentum, ProPetro again delivered solid results in the second quarter. David will walk you through our financial results in a few minutes. But first, I'd like to go over a few highlights from the quarter and take stock of where we are halfway through the year. As we've discussed many times, modernizing our fleet has been an important strategic priority. In this quarter, we were pleased to deploy our seventh tier four DGB dual fuel hydraulic fracturing fleet. As expected, given our diversified blue chip customer base, Demand for our dual-fuel portfolio remains very strong and more insulated from any near-term bubbles in the market. Additionally, in the third and fourth quarter, we begin our new force electric frac fleet deployments. We plan to deploy our first fleet in August and the second fleet early in the fourth quarter. We are also still on track to deploy two additional force fleets in the first half of 2024. With the ongoing high demand for this equipment, we plan to begin operating these fleets as soon as we receive them. As you all know, we acquired Silvertip Completion Services in November of 2022, therefore making our entry into wireline services. And we are pleased to have seamlessly integrated the company since that time. The Silvertip acquisition continues to be a significant tailwind for ProPetro's earnings and free cash flow profile. ProPetro has developed a strong track record for identifying, acquiring, and successfully integrating high-quality assets, and we continue to make excellent progress on our strategic initiatives. We will continue to seek value-accretive acquisition opportunities to further enhance our growth. As always, we will be disciplined and opportunistic in deploying capital, prioritizing only high-return opportunities that will enhance free cash flow and create shareholder value. Consistent with our overarching focus on delivering strong returns for investors, in addition to reviewing value-enhancing acquisition opportunities, our board and our management team also prioritizes the return of capital to ProPetro shareholders. During the second quarter, we were pleased to announce a $100 million share repurchase program. The program gave authorization to repurchase approximately 13% of the company's market capitalization based on the value of the shares at the time of the announcement in mid-May. The share repurchase program is directly aligned with our strategy to drive free cash flow growth and create value for our shareholders. Through this program, we plan to capitalize on dislocations between the company's public equity valuation and what we believe is its intrinsic value. During the second quarter, the company repurchased approximately 2.3 million shares for about $17.5 million at an approximate 27% discount to the current share price as of July 31st, 2023. This represents 2% of total outstanding shares. I would now like to address the market environment and recent headwinds and provide some detail on how we're navigating through the choppiness. Undisciplined pricing concessions at the expense of keeping fleets utilized, especially from some of our distant peers exposed to the spot market, did have an impact on the overall frat market. Due to some of these circumstances, we elected to sideline one fleet during the quarter. This was an easy decision for us given the low pricing we would have had to put forward to keep the fleet operating. And we are now able to strategically preserve these assets and not run the equipment at sub-economic levels. I want to reiterate that we are committed to only running our fleets at economic levels that earn full cycle cash on cash returns. I do want to note that because of our disciplined approach and our bifurcated offering, we have been able to effectively offset much of the pricing pressure in various ways, including directly handling or contracting more materials and services on location. We believe that ProPetro is positioned to effectively handle materials and services on location and will continue to pursue more of that market. Even in the face of the headwinds I just mentioned, we remain confident in our ability to continue to deliver strong financial results. Looking into the future, we remain bullish on ProPetro's potential for growth and value creation over the next several years. We believe we are still in the early stages of a sustained upcycle that will be supported by the industrialization of the frac space, which is more resilient and disciplined than previous cycles. And we believe ProPetro is well positioned to succeed in this new chapter for our industry. We do expect the second half of the year will be only slightly down from operational levels that we saw in the first half, Therefore, we believe current recount is approaching the bottom, and it's possible it might already be on bottom. Importantly, despite some of these challenges across our industry, we are not slowing down. Ropetro offers differentiation in our service quality, equipment, customer portfolio, and operational density in the Permian. We believe in this bifurcation internally and also hear this directly from our customers. This differentiation continues to insulate us from some of the market inconsistency outside of the Permian, and in the spot market. We are confident that our continued capital discipline and improved free cash flow profile will allow us to maintain a strong balance sheet as we move forward while also executing opportunistically on our share repurchase program. As always, we remain focused on executing our strategy, which has proven successful throughout various economic cycles to deliver superior returns for shareholders. Finally, I'd like to take a moment to thank our incredible ProPetro team It's their continued dedication and hard work that helps us achieve consistently solid results quarter over quarter. Now I'll turn the call over to David to discuss our second quarter financial results.