ProPetro Holding Corp.

Good day, and welcome to the ProPetro Holding Corp. First Quarter 2024 Conference Call. Please note, this event is being recorded. I would now like to turn the call over to Matt Augustine, Director of Corporate Development and Investor Relations for ProPetro Holding Corp. 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 first quarter of 2024. 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. First quarter of 2024 was an exciting start to the year for ProPetro. Before David walks you through our financial results, I'd like to begin by covering some important business highlights. As we mentioned last quarter, this year we expect to demonstrate that our strategy is and will continue working. To start off the year, we initiated strategic actions to build on our recent progress, and we're pleased to report that those actions, coupled with recent investments, are yielding strong returns. Let's walk through some of the specifics. First, underpinning our strategy is our ongoing fleet transition from legacy equipment to next generation assets. Over the last two years, we have worked to create a next generation fleet to meet the needs of an evolving industry both today and into the future. We've invested approximately $1 billion to recapitalize our fleet with state-of-the-art technologies and services. Today, we have transitioned over two-thirds of our fleet to next generation equipment delivering premium value for our customers while lowering emissions through things like industry-leading natural gas substitution. Strong demand for our assets and services continues to support our solid performance. Our outlook for electric equipment remains particularly bright. Having significantly upgraded and modernized the majority of our fleet, we are excited to realize strong returns in 2024 and for years to come. Our force electric fleet offering is uniquely positioned to create value for our customers. We now have three force electric fleets deployed, with a fourth deploying by the end of the second quarter, and seven Tier 4 DGB dual fuel fleets operating with industry-leading diesel displacement. Our force electric fleets, which we first deployed in early September of last year, have built a reputation of performing at high levels operationally and financially. As a testament to the success of our force offering and our execution here in the Permian, we were proud to announce earlier this week our latest contract with ExxonMobil. This agreement is a direct result of our strategy and pursuit of an industrialized model to create premium value for our customers and is supported and made possible by our first-class operating team in the field. I'd like to take a moment to walk through some of the highlights of our agreement with ExxonMobil to underscore why it is such a significant step and important achievement for ProPetro. This is a three year agreement to provide our force electric powered hydraulic fracturing services, coupled with silver tips wire line and pump down services to ExxonMobil. The agreement calls for the delivery of two force electric fleets paired with wire line and pump down services in the first half of this year, with the option of a third fleet to commence operations early in 2025. This agreement is a significant achievement for us, showcasing ProPetro as a trusted partner to a widely recognized industry leader and global super major. This also demonstrates our ability to successfully deliver multiple completion services through an integrated operation to our customers. The ExxonMobil agreement, along with our other contracted force electric equipment, is a glimpse into what the future of ProPetro will look like, inclusive of a more durable earnings profile. We work closely with our customers, creating efficiencies tied to transparency, logistics, and higher utilization. We're proud to deliver faster, more efficient, and flexible services while reducing risk and costs for our customers, all made possible by our team here at ProPetro. Our electric equipment is in high demand, and we plan to continue to transition our Tier 2 diesel equipment to force electric equipment over time in a manner that minimizes our overall capital costs. garnering committed contracts that de-risk our earnings performance over the long term. Having covered our fleet transition and recent force developments, I want to move to another core attribute of our strategy, our disciplined approach to inorganic growth. Our successful capital deployment track record of value-enhancing M&A supports our resilient and improved results. We continue to pursue value-accretive acquisitions like our recent acquisition of Par5 Semantic, The accretive earnings impact and expected revenue synergies from that acquisition are already beginning to show in our results. This builds on our momentum of our silver tip acquisition, which continues to be a strong tailwind for our earnings power and free cash flow. We will stay opportunistic in our pursuit of accretive M&A opportunities at valuations that make sense. The final key element of our strategic focus is our capital allocation philosophy. With our capital allocation strategy supported by strong, resilient free cash flow, we remain opportunistic in returning cash to shareholders. Just last week, we announced that our board approved an increase and extension of our share purchase program through May 31st of 2025 with an additional $100 million authorized for a total of $200 million. Since the inception of our plan last May in 2023, ProPetro has repurchased approximately 8% of our outstanding common stock. We have consistently executed on the share purchase program, and this recent increase confirms our board's confidence in ProPetro's continued earnings growth and free cash flow generation. Now turning to our results. We started off 2024 with an impressive quarter that also shows the success of our execution in the field, our strategy, and the recent investments we've made to enhance our earnings power. Our differentiated offering that supports operational excellence, our blue-chip customer base, next-generation equipment, and operating density in the Permian Basin make our company strong and resilient. We are excited that this year we can reduce capex spending as our large reinvestment capital requirements are now behind us. This will continue to support free cash flow and our capital allocation approach in 2024 and beyond. We remain very confident in our ability to deliver durable and repeatable financial results for the long term. Turning now to the macro outlook. Despite market volatility, our approach to the market creates differentiated stability. The recent upstream M&A extends and confirms our capital discipline mindset and strategy we are pursuing. Perpetua offers bifurcation with the goal of being highly sophisticated service provider that can serve the needs of the consolidating EMP space. To summarize, we're generating strong free cash flow and continue to evaluate the creative M&A opportunities to enhance our earnings power while returning capital to shareholders through our share purchase plan. Our proven discipline And transformed bifurcated fleet gives us confidence in our strategy and earnings potential during what we see as a slow to no growth environment. We are confident that our more industrialized model will continue to drive success for ProPetro and benefit the space for years to come. I'd now like to turn it over to David to discuss our first quarter financial results. David.